10A — April 10 - 23, 2015 — M id A tlantic
Real Estate Journal
www.marejournal.com
F inancial D igest By H. Jack Miller, Gelt Financial Corporation How do investors receive liquidity for their minority interest positions in real estate partnerships? O ne common invest- ment strategy in commercial real es- ship through the secondary market, or any outside real estate investor.
cash-flow problems arise and quick liquidity is required, we provide a reliable exit strategy. H. Jack Miller, Gelt Fi- ancial Corporation. n
turns. In example, ten real estate investors want to buy a commercial building for $1,000,000. If they each invest $100,000 they can pur- chase that property and each investor would receive a 10% minority interest position in the partnership. While pooling funds to purchase larger and more de- sirable properties has many benefits, it also has many downfalls. One of the major problems that minority inter- est owners face is illiquidity. Since the authority to sell the investment property is usually left to the majority
members or managing mem- bers, the minority interest investors face limited routes when financial problems arise and they need access to quick capital. The managing members are legally bound to do what is best for the partnership’s investment as a whole, which is often to not sell the investment property. This prevents minority in- terest investors from selling their shares at fair market value. Minority interest owners do however have the ability to sell their minority position in the real estate partner-
t a t e i s t o bring mul- tiple real es- tate inves- tors together to pool their cap i t a l i n o r d e r t o p u r c h a s e a property
We are direct buyers of minority interest in real estate partnerships. When
Eastern Consolidated arranges $236m sale of Kings Portfolio
Group LLC and DavidMalek of Malek Management LLC acquiring the 15-property rental portfolio from Urban American. Eastern Consolidated chairman and CEO Peter Hauspurg , principal and ex- ecutive managing director David Schechtman , princi- pal and senior director Peter Carillo , and director Marion Jones represented the seller in the transaction. Eastern Consolidated senior managing director and principal Lipa Lieberman represented the buyer. Senior director of fi- nancial services Gary Meese , served as the analyst in the transaction. The 1.5 million s/f portfolio includes a total of 1,434 apart- ments, 99% are occupied and 96% are rent stabilized among 15 multi-family rental prop- erties. All properties are in excellent physical condition, with Urban American having invested more than $13 million in major capital improvements across the portfolio since Au- gust 2007. Of the geographically concen- trated residential assets, seven are located in the East Flat- bush/Remsen Village neighbor- hoods of North Central Brook- lyn, seven are located in the Midwood/Flatlands neighbor- hoods of South Central Brook- lyn, and one garden apartment complex is located in the Oak- wood neighborhood in Staten Island. The two largest buildings in the portfolio are a 178-unit property at 2425 Nostrand Av- enue in Midwood in Brooklyn, and a 176-unit complex at 2838- 2868 Hylan Blvd. in Staten Is- land’s Oakwood neighborhood. “It is rare that a portfolio of this quality and size ever comes to market in NewYork City and especially rare during a time when abundant debt and equity financing exists,” Schechtman said. “This is an incredibly large, stable portfolio with high occupancy and strong in-place income with units across a broad cross-section of the most ascendant NYC borough.” nwe
NEW YORK, NY —In a landmark transaction, Eastern Consolidated has arranged the sale of “The Kings Portfolio”, spanning Central Brooklyn and Staten Island for $236 million with principals Peter Re- benwurzel of Coney Realty
H. Jack Miller
that individually they could not afford. This provides in- vestors with limited capital greater leverage by using their funds to invest in larger properties with higher re-
Term Loans • Lines of Credit • Construction Financing • Commercial Mortgages
For New Jersey Commercial Financing Count on Columbia.
$2,250,000 Term Loan Medical Group Bergen County
$17,000,000 CRE Mortgage 175 Apartment Units Bergen County
$4,950,000 Line of Credit Real Estate Investor Middlesex County
Please Contact: Deborah Scelzo Senior Vice President/Commercial & Industrial Lending 201-599-7006 dscelzo@columbiabankonline.com Paul A. Heilmann Senior Vice President/Commercial Real Estate 201-599-7076 pheilmann@columbiabankonline.com Gordon Gorab
$15,375,000 CRE Mortgage Retail and Medical Complex Middlesex County
$2,830,000 Construction/Permanent Mortgage
Auto Dealership Camden County
$1,800,000 Term Loan Marine Engineering & Construction Contractor Gloucester County
Senior Vice President/Commercial Lending Middle Market Manager 201-794-5653 ggorab@columbiabankonline.com
Convenient Offices Throughout New Jersey columbiabankonline.com Count on Columbia.
Member FDIC
Made with FlippingBook - Online Brochure Maker