Victory Hill East in Victory Gardens — Courtesy: The Kislak Co. Inc.
By Joshua Burd
Five apartment properties in northern New Jersey have traded for a total value of more than $21 million, under a 1031 exchange brokered by The Kislak Co. Inc.
In a news release, the firm said it represented a longtime client in the deals, which include the $7.46 million sale of a four-property, 85-unit portfolio in Paterson. The same client then paid $13.7 million to acquire Victory Hill East, a 124-unit multifamily property in Victory Gardens.
Vice President Joseph Keenan represented the sellers of the Paterson portfolio and also procured the buyer, according to a news release. The client had owned the 85 units for more than 20 years, with the portfolio including 20 units on East 31st Street, two properties with 30 units on Sherman Avenue and one property with 35 units on 12th Avenue.
“Joe did an outstanding job facilitating these transactions,” Robert Holland, president of Kislak, said in a prepared statement. “He led our exclusive marketing efforts regarding the portfolio, procured the purchaser and then identified a great off-market exchange property in an excellent location for the sellers, who were very pleased with the results.”
After only a 14-day marketing period that resulted in multiple offers, the sellers selected the purchaser, a Bergen County-based family with substantial holdings in Paterson that was eager to add the properties to its portfolio, Kislak said. All properties include on-site parking with separate utilities and below-market rents.
“When it was time to market and sell their Paterson portfolio that they assembled over the past 20 years, the sellers were confident in our ability to deliver,” Keenan said. “The purchaser plans to make interior renovations on turnovers and will raise rents accordingly.”
At the time of closing, the properties were fully occupied. The seller was represented by Jonathan Mehl of Rutherford, while the buyer was represented by Kevin Kelly of Kelly, Kelly & Marotta LLC of Maywood.
The Victory Gardens property is located between Randolph and Dover in central Morris County, with immediate access to Route 10, Kislak said. The seller, the original developer of the complex, had minimal debt on the property, allowing Keenan to negotiate seller-provided financing with an interest-only period to allow the buyers to make improvements and ultimately raise rents.
The property was 94 percent occupied at the time of the sale, the news release said. The seller was represented by James Delia of Wells, Jaworski & Liebman LLP of Paramus.
The buyer was represented by Jonathan Mehl, Esq.
“Once we made the Paterson deal, we worked very hard to identify the right exchange property,” Keenan added. “The length of the sellers’ ownership mandated it.
“We called on many of our existing relationships and identified an off-market opportunity in Victory Gardens with significant upside potential only a few miles from another 100-unit property that Kislak had sold to them a few years prior.”