EAST ORANGE, NJ—MCP Real Estate & Investment Management has acquired a portfolio of four multifamily buildings totaling 72 units in East Orange from Seaview Capital Partners for about $7.4 million as part of an $11.75 million series of transactions brokered by The Kislak Company.
According to Real Capital Analytics, a proprietary research database, MCP acquired the 72 units in a portfolio of four buildings at 30 Beech Street, 46 South Arlington Avenue, 356 William Street and 6 Glenwood Avenue; Kislak also sold 47 units in two buildings at 139 Halsted Street (sold by TBG Halsted) and 116-118 South Grove Street (sold by TBG South Grove St.) for $2.45 million; and another 21 units at 67 Lenox Avenue (sold by 67 Lenox LLC) for $1.9 million. Kislak described the purchasers of the properties as private investors.
Sales associate Julie Gralla represented Seaview Capital Partners in the sale of the 72-unit portfolio and TBG Halsted and TBG South Grove St. in the sales of the two-building, 47-unit portfolio. She also represented the unidentified purchasers of the Halsted and Grove Streets and Lenox Avenue properties. Vice president Robert Squires represented MCP, the purchaser of the 72 units. Senior vice president Joni Sweetwood represented the LLC seller of the Lenox Avenue property.
“Prices continue to skyrocket to well over $100,000 per unit in East Orange,” says Julie Gralla. “The city is extremely desirable to tenants and investors with two midtown direct trains providing service to and from Manhattan in 20 minutes.”
“The East Orange and surrounding multifamily markets remain extremely attractive to investors given their north Jersey locations that are a short commute to New York City,” says Robert Holland, Kislak president. “Occupancies are extremely strong and rents are increasing, which add to investor demand. Julie and our team did an excellent job executing these sales.”
“The sellers turned over many units after purchasing the portfolio,” says Gralla. As a result, even throughout the transaction, the portfolio’s net operating income continued to increase dramatically as rents continue to rise. This is a testimony to great management but also to East Orange’s strong rental market.”
The 72-unit, four-building portfolio contained many two and three bedroom units, and two of the four buildings were gut-renovated within the last ten years. While the four buildings are within walking distance of the midtown trains, they are also easily accessed by commuters to Route 280 and the Garden State Parkway.
The properties at Halsted and South Grove Streets, located just over one mile from each other, contained 25 one-bedroom units at Halsted Street and 22 one-and two-bedroom units at South Grove Street with onsite parking at both properties.
“What made this deal so valuable was the extreme upside potential due to higher expenses which needed to be properly managed, as well as below market rents,” Gralla says.
Holding a long-term relationship with the buyer of the Halsted and South Grove deal, Gralla is “excited to see how the buyer will transform these buildings, stabilizing the properties under his management.”
The three-story brick building with 21 units at Lenox Avenue consisted of a studio and one and two bedroom apartments, with hardwood floors, large kitchens and separate dining areas, all with upgraded electric installed in the last 10 years. The buyer of this property had purchased through Kislak several other East Orange buildings earlier this year.