Security Properties has acquired The Commons and 5819 Glisan, two apartment complexes in Portland, Ore., comprising 172 and 56 units, respectively.
The Commons is a five-story mid-rise affordable housing property that serves the 55+ community in eastern Portland. The property was originally constructed in 1999 utilizing 4% low-income housing tax credits (LIHTCs) and rents to seniors with incomes below 60% of the area median income.The 5819 Glisan, also a five-story mid-rise, is a market-rate property, constructed in 1999, as well. The assets represent two of the four housing developments in the mixed-income Center Commons, which also includes Center Village, a housing community serving low-income families, and for-sale townhouses. With excellent proximity to the MAX rail system, these properties are very well connected to the greater Portland area.
Security Properties closed the acquisition of The Commons with bridge-loan financing provided by PNC Bank, which will allow Security to secure an allocation of 4% LIHTCs and tax-exempt bonds in the upcoming six to nine months. The allocation of 4% tax credits will finance a significant rehabilitation of The Commons, largely focused on the building's exterior. "Renovation of The Commons will allow Security Properties to preserve the long-term affordability of the building while servicing the senior community for years to come," said Bryon Gongaware, managing director of affordable housing at Security Properties, in a statement. "Both the preservation and rejuvenation of affordable housing were our driving forces in this effort."
The 5819 Glisan, which neighbors The Commons to the south, was purchased alongside the latter property. The 5819 Glisan is a conventional family building whose use restrictions were released in 2014. It was built in conjunction with The Commons and offers diversification as a community comprised of varied ages and incomes.
The acquisition was financed with a 10-year floating-rate Fannie Mae loan sourced by Pillar Financial, a division of SunTrust Bank, which, along with institutional capital, will provide the funding for a rehab on this property. The exterior envelope of the building will receive significant upgrades, along with an extensive interior rehabilitation plan that will include new appliances, flooring, lighting, countertops, cabinet fronts, and kitchen/bath fixtures.
This acquisition will add to Security Properties' already large Portland portfolio of over 1,000 conventional units. "We believe the demand for quality affordable and mixed-income housing in Portland is underserved," said Steve TeSelle, the firm's director of affordable housing. "This renovation plan provides an opportunity to considerably improve the property as well as the community as a whole."
The Commons, 5819 Glisan, and Center Village will be professionally managed by Security Properties Residential.
