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Real Estate - Residential

Downtown Apartments Fetch Top Dollar In Top Sale Of The Year

By Cece Nunn, posted Dec 22, 2021
Flats on Front, a northern downtown luxury apartment complex, sold for $97.5 million this month. (Photo courtesy of Cline Design Associates)
The recent sale of luxury apartments in downtown Wilmington represents the highest-priced real estate transaction in the Cape Fear region in 2021 so far, according to property tax records and local brokers.

Brookfield Real Estate Income Trust Inc. (REIT) bought the 273-unit Flats on Front, 1045 N. Front St., for $97.5 million, which represents the highest price per apartment, a little over $357,000, ever scored in the area, records show. The acquisition was also reported by GlobeSt.com.

The next-highest transaction of 2021, the $79 million sale of Avalon Apartments off Market Street in Wilmington, took place in September. The buyer paid $76 million for 372 units and another $16 million for 84 apartments in Phase II of the complex.

The previous per-unit record was also set this year when a Baltimore-based firm in August bought the 264-unit Reserve at Mayfaire apartments for $76 million, or $287,878 per apartment.

The seller of Flats on Front, a joint venture between DPJ Residential and Chaucer Creek Capital, was also the developer of the Flats, part of an apartment boom along the northern riverfront in downtown Wilmington.

“Since we offered to buy the vacant piece of land back in early 2017, there have been a lot of firms and personnel involved in designing, building and managing this apartment community,” said Porter Jones of DPJ Residential, the company that also developed the Mayfaire Flats off Military Cutoff. “Although we can now reflect back on our success, there were many sleepless nights for me and others who were involved, whether it was due to unforeseen supply chain challenges or trying to lease up a new community during a global pandemic. 

“Lucky for us, we had a great team to work through these issues and be able to execute on our business plan.” 

The team included Clancy & Theys as general contractor, Cline Design Associates and Hostetler Architecture as the architects and Bell Partners as the property management firm.

Vice Chairmen John Heimburger, Sean Wood and Dean Smith, Senior Managing Director Alex Okulski and Managing Directors Jason Kon and John Munroe of Charlotte-based commercial real estate company Newmark brokered the sale.

Jones is also developing 17 Social, an apartment complex on South 17th Street that he said is 70% leased.

He said, “We hope to be involved in many future developments in and around downtown as well as other parts of Wilmington."

The Flats on Front complex is just one example of the major investments developers have made in recent years in the same area, including Sawmill Point at 1015 Nutt St. and Pier 33 Apartments at 901 Nutt St. 

“We always felt the North Waterfront area was lacking connectivity to downtown, but now with the new Riverfront Park amphitheater, Live Oak Bank Pavilion, this area feels so much more active,” Jones said. “As more development occurs, we believe the North Waterfront neighborhood will be one of the most unique, vibrant and walkable areas in the entire state.”

Sawmill Point, which has 280 apartments, sold for more than $65 million in 2019. That complex was developed by Cary-based Symphony Properties and is now owned by Chaucer Creek Capital, a Raleigh-based apartment owner and asset manager.

As for the new owners of Flats on Front, the Brookfield name is well-known in Wilmington. Brookfield REIT is managed by a subsidiary of Brookfield Asset Management (NYSE: BAM), a company headquartered in Toronto, Canada.

Another Brookfield subsidiary owns the nearly 1 million-square-foot Independence Mall at 3500 Oleander Drive, and in May this year, Brookfield Residential announced its acquisition of Riverlights development company Newland.
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