A New York-based real estate investment firm has purchased the apartments at The Triangle in North Austin for $129 million.
Castle Lanterra Properties’ purchase of the 529-unit class A property dubbed Residences at The Triangle at 4600 W. Guadalupe St. closed July 9, according to a July 15 announcement. The seller was Houston-based The Dinerstein Companies. Sean Sorrell of Jones Lang LaSalle facilitated the transaction.
“The Triangle is an exceptional institutional-quality property located in the epicenter of tremendous growth in one of the most dynamic cities in the country, within a booming market that is likely to perform well over the long term,” CLP CEO Elie Rieder said in a statement. “We are now planning a substantial investment in upgrading the homes to take advantage of limited new supply driving strong demand for Class A residences.”
This is Castle Lanterra Properties’ first acquisition in the Austin area since 2016. In recent years, it has sold at least three multifamily properties from Pflugerville to South Austin.
Amid the Covid-19 pandemic, investor interest in the Austin area has remained strong especially in multifamily and industrial properties. Multifamily has remained a stable asset class amid the pandemic because of steady rent collections and the area’s rapid job and rent growth prior to shelter-in-place orders.
Despite that, apartments rents have dropped 3% or by $39 in the Austin area since March, according to the latest report from ApartmentData.com.
Regarding why Castle Lanterra Properties made the purchase during the pandemic, Rieder said the property is a “well-located asset with further upside potential.”
He added: “While the pandemic does present some short-term risks and challenges, we are investing for the long-term and expect that this property will perform well over time.”
Rent collections at The Triangle have been averaging above 99% since the beginning of the pandemic, according to Castle Lanterra Properties.
The company declined to provide the occupancy rate of the apartment complex at the time of purchase.
Built between 2006 and 2008, The Triangle is a six-building residential complex near the intersection of Guadalupe Street and North Lamar Boulevard. It is adjoined by 111,000 square feet of retail and commercial space occupied by such tenants as Maudie’s Tex-Mex, Mama Fu’s Asian House and Mandola’s Italian restaurant. North Carolina-based Asana Partners LLC owns the commercial section of The Triangle.
The Triangle is in a high-growth area of North Austin surrounded by medical centers and just to the west of the new Texas Health and Human Services Commission headquarters.
Amenities at The Triangle include a modern fitness center, a chef-inspired common kitchen, conference rooms, gourmet coffee bar, dog park with monthly pet events, three swimming pools, a fire pit and cabanas. Apartment units offer such features as nine- to 11-foot ceilings, hardwood-style flooring, deep kitchen sinks with gooseneck faucets, black and stainless-steel appliances, washer and dryer, granite or quartz countertops and private balconies.
Castle Lanterra Properties declined to say how much it planned to invest in upgrades.
Founded in 2009, Castle Lanterra Properties focuses on multifamily acquisition and management in growth markets nationwide. The company currently owns and manages more than 7,100 units across 24 properties.
Publication: Austin Business Journal