Vistas at Jackson Creek, a luxury 267-unit apartment complex in Monument, has been acquired for $57.8 million by a private owner, who was also provided with a Housing and Urban Development loan for $48.1 million.
The purchase was announced Dec. 6 by real estate investment services firm Marcus & Millichap. The private investment entity was represented by Marcus & Millichap Senior Associate Nick Steele and First Vice President of Investments Jacob Steele. The Vistas at Jackson Creek secured the 35-year HUD 223(f) loan through PGIM Real Estate Finance, a $1 trillion commercial mortgage branch of Prudential Financial, according to a separate news release issued Dec. 5.
The Class-A apartments, which include 12 three-story buildings, are located on 14 acres close to Interstate 25. The first phase of the apartment complex, 177 units, was completed in 2014, and phase two, 90 units, was built by 2016. This October, the apartments received the U.S. Environmental Protection Agency’s Energy Star certification.
“Colorado Springs is one of the top-performing apartment markets in the country currently and northern Colorado Springs, which includes Monument, has some of the area’s highest rents,” Nick said in the news release. “Vistas at Jackson Creek is positioned to benefit from the continued strength of the Colorado Springs market as well as rapidly growing suburban Denver communities to the north. The asset should prove to be a well-considered investment for our clients for years to come.”
The two Colorado-based apartment owners and investors acquired the property at an opportune time and achieved a strong number for the sale, Nick said.
“This investment is another example of the strength of the market speaking for itself, it’s an area a lot of folks would like to have exposure to,” said Nick.
Apartment amenities include a swimming pool, picnic area and playground, a clubhouse, a fitness center and covered parking.
“As a newly constructed apartment complex in a desirable location between Denver and Colorado Springs, Vistas at Jackson Creek makes a great addition to our portfolio,” said Patrick Kempton, principal and transaction lead for PGIM Real Estate Finance, in the release. “We look forward to closing additional transactions in the West region with our partners at the Denver HUD office.”
According to Kempton, the client with Vistas at Jackson Creek requested the HUD loan and plans to retain the loan long-term.
“The loan amount was based on the HUD 223(f) loan parameters, which provide loan proceeds up to 85 percent [loan-to-value],” Kempton said in an email. “This allowed the borrower to maximize their loan proceeds on a long-term basis.
“Any borrower with a long-term investment horizon receives the benefit of non-recourse debt with great cash flow and no refinance or interest rate risk in the future.”
Vistas at Jackson Creek also qualified for a Green Energy Efficient reduced mortgage insurance premium, Kempton said.