Brown Gibbons Lang & Company (BGL) is pleased to announce the acquisition of a four-building multifamily portfolio in Washington, D.C. on behalf of RLP Investments LLP (RLP). In total, the portfolio consists of 51 units and 36,324 square feet of multifamily real estate, approximately 10 miles east of downtown Washington, D.C. BGL’s Real Estate Advisors Group served as the exclusive financial advisor to RLP in the transaction. Financing for the acquisition and renovation of the properties was provided by MainStreet Bank. The developer was represented by Steven M. Buckman of BuckmanLegal, PLLC of Washington, D.C.
Mikhail Phillips, Managing Member of RLP, commented, “BGL was able to help secure the acquisition financing in a very quick and efficient manner, as they stepped in when a prior advisor was not able to secure financing. BGL did a fantastic job and we were very pleased with the outcome.”
RLP plans to spend approximately $2 million to renovate all four buildings with a complete interior floor-to-ceiling upgrade of each unit, while also adding five additional units throughout the properties. With the upgrades, the average rental rates will be approximately 2.5x higher than the current rates, averaging $2.72 per square foot on a 713 square foot unit, or $1,940 per month.
The portfolio includes 711 49th Street NE (15 units comprising 9,921 square feet), 719 49th Street NE (8 units comprising 5,749 square feet), 5128 Sheriff Road NE (12 units comprising 8,878 square feet), and 5134 Sheriff Road NE (16 units comprising 11,686 square feet). All of the properties are located in a federally certified Opportunity Zone.
Created in the Tax Cuts and Jobs Act of 2017, Opportunity Zones provide tax incentives for investments in new businesses and commercial projects in low-income communities. Opportunity Zones allow investors to defer tax on realized capital gains deployed through a qualified Opportunity Fund until December 31, 2026, or the time of Fund disposition. If the investment is held for 10 years, 100% of the gain from the Opportunity Zone investment may be excluded from federal income tax.
The properties also accept vouchers from the Housing Choice Voucher Program (HCVP), administered by the District of Columbia Housing Authority (DCHA) and federally funded by the U.S. Department of Housing and Urban Development (HUD), which helps eligible families or individuals with rental assistance.
BGL’s Real Estate Advisors team offers comprehensive real estate investment banking services tailored to the middle market. It provides client-focused solutions with an emphasis on real estate advisory, debt, preferred and private equity placement, financial restructuring, recapitalizations, sale-leasebacks, structured finance, and asset acquisitions and dispositions across all asset classes. The team assists real estate owners and developers looking to form alliances and joint ventures with single-source capital providers to gain local and institutional access for all capital needs.