LAWRENCEVILLE, Ga., July 14, 2014 /PRNewswire/ — The RADCO Companies (RADCO), one of the nation's leading real estate opportunity development companies, has continued its value-added strategy with the sale of Ashford Way, a 98-unit multifamily property in Lawrenceville, Ga. KENCO Apartment Communities (KENCO), a locally based real estate investment firm, acquired the apartment community for $5 million, or $51,020 per unit. The announcement was made by the company's founder and CEO, Norman J. Radow.
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Photo – http://photos.prnewswire.com/prnh/20140711/126346
The community was built in 1987 in the heart of Gwinnett County. Ashford Way offers one- and two-bedroom units that average 752 square feet.
RADCO originally purchased the multifamily complex in December 2012 out of receivership for $29,000 a unit. The company implemented a $1 million value-added capital improvement plan that included rebranding the property, upgrading unit interiors, renovating the building exteriors, and expanding the amenity package. Under RADCO's management, occupancy rose from 71 percent at acquisition to more than 97 percent at the time of sale. In addition, average rents rose more than $75 per unit during that period.
"The sale of Ashford Way is not only a win for us, but also a win for KENCO. I know the company will continue to take the property to the next level," said Radow. "We are pleased that we were able to turn the property around by addressing deferred maintenance issues, aging infrastructure problems, and renovating the complex to a higher standard, and we are excited to hand it off to a great operator."
The deal traded at a significant premium compared to the returns that RADCO originally modeled in its turn-around strategy. KENCO also purchased Somerpoint, a 144-unit community in Marietta, GA, from RADCO in February.
"By each of us sharing our deal-related expectations up front and then continuing to foster open and honest communication, our transaction with RADCO has been very smooth and enjoyable," said Clayton Edwards, Jr., president of KENCO. "Ashford Way presents a great opportunity to boost net operating income by building on the positive momentum that RADCO created in an improving market."
In 2014, RADCO has already purchased five properties including nearly 1,400 units in three cities, requiring a capital investment of $170 million. The company has another four properties under contract that will close this summer.
Atlanta-based ARA brokered the transaction.
The RADCO Companies
RADCO's mission is "Building Better Living." Based in Atlanta, the national real estate acquisition and redevelopment company was founded in 1994. The firm has grown its multifamily portfolio to include approximately 6,300 units in Georgia, Illinois, Indiana, Oklahoma and Colorado, with an additional 860 units under contract. To date, RADCO has raised $130 million in private equity to fund its transactions.
KENCO Apartment Communities
Founded in 1964, KENCO has a long history of developing, acquiring and managing apartment communities throughout metro Atlanta. As a family-owned company, KENCO is entering a new phase of growth that is being led by the third generation. By leveraging the company's multifamily expertise and solid reputation in the marketplace, KENCO is actively pursuing new acquisitions.
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