Dealmaker: TruAmerica Multifamily Buys Colorado Multifamily for $53M

TruAmerica Multifamily, Los Angeles, acquired Thornton, Colo. apartment community Fox Creek for $53 million in an off-market transaction.

CBRE Executive Vice Presidents David Potarf and Dan Woodward represented TruAmerica and capital partner Magnolia Real Estate Fund, McLean, Va.,  as well as the private seller. CBRE Capital Markets Vice Chairman Brian Eisendrath arranged financing through Freddie Mac’s select sponsor program.

Built in two phases starting in 1984 and delivering in 1999, Fox Creek has 287 units on 19.5 acres. The acquisition represents TruAmerica’s sixth Denver area multifamily investment in the past three years. The firm now owns nearly 3,000 units in metro Denver.

“Fox Creek represents a true value-add opportunity as the majority of the units, which feature vaulted ceilings, fireplaces and full size washer/dryers, have been largely untouched,” said TruAmerica Senior Managing Director of Acquisitions and Dispositions Greg Campbell. “About a quarter of the units also have lofts, an attractive feature not found at other assets in the immediate area.”

Campbell noted that his firm has a comprehensive renovation plan to allow Fox Creek to compete with newer properties in the area while remaining affordable to working families. The renovation will include common-area improvements including pools, fitness center, signage and landscaping. TruAmerica will also renovate unit interiors as apartments turn over with new appliances, bathroom countertops and cabinets and upgraded plumbing fixtures.

Thornton is 10 miles north of Denver. Construction activity in northern Denver submarkets has been limited compared to overall the metro Denver pipeline, which currently includes more than 23,000 units. Just 2,564 units are being added in northern submarkets Thornton, Westminster and Arvada.

“Fox Creek presents an attractive opportunity to invest in a well-located asset at a discount to replacement cost in one of the most fundamentally sound rental markets in the nation,” said Magnolia Managing Partner David Kent. Fox Creek represents the first investment for the recently launched Magnolia Real Estate Fund.