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Castle Lanterra Properties Completes $56 Million Central New Jersey Acquisition

| March 22, 2016 | 0 Comments

River Park with PoolCastle Lanterra Properties, LLC
One Executive Blvd., Suite 204
Suffern, NY 10901

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Adds 224-Unit River Park in Raritan to Growing New Jersey Portfolio

RARITAN, N.J. March 22, 2016 – River Park, a 224-unit apartment community in Somerset County’s borough of Raritan, is the latest addition to Castle Lanterra Properties’ (CLP) multifamily portfolio. The $56 million transaction marks CLP’s second New Jersey acquisition in the past five months, following the addition of Harbor Pointe, a 544-unit, Class A waterfront property that was purchased for $147.5 million on October 21, 2015.

The seller of River Park was a global insurance group. Cushman & Wakefield’s Metropolitan Area Capital Markets Group represented the seller and procured CLP as buyer in this significant trade.

“Having personally invested in a substantial number of apartment communities in New Jersey over the past 18 years, I knew the $250,000 per unit valuation at which we were able to acquire this immaculate property was a solid entry point,” said Elie Rieder, CLP’s founder and CEO. “Historical sales of other competitive properties within this submarket have seen prices in the $275,000-285,000 range.”

Constructed in 2007, River Park “was built to condominium specifications,” said Benjamin Loney, head of acquisitions for CLP. “Very high quality materials were used during construction. Due to the financial crisis, the decision was made to turn River Park into a rental property.” River Park’s amenities include an underground parking garage, a heated pool, fitness center, tennis courts, club room, business center with conference room, recreational facilities, and onsite concierge.

“Currently, this property trails its competitive set in both occupancy and rent, even though no other properties in this submarket can offer the same level of amenities found at River Park. We believe there is an immediate opportunity to increase occupancy and rent to levels that are consistent within the marketplace, even before we commence our unit renovation program. We also intend on making improvements to the common areas,” added James Brady, vice president of operations, “which will help to elevate the tenant experience.”

And while River Park is just a 10-minute walk from Raritan’s New Jersey Transit rail station, which provides access to Newark and Manhattan’s Penn Station, Somerset County is driven by a very strong employment base that includes 16 million square feet of occupied office space, all within a 15-minute drive. This includes large sprawling corporate campuses for many of the world’s largest companies; including several Johnson & Johnson divisions, Janssen Pharmaceuticals, Goldman Sachs, ING, Citigroup, AT&T, Merck, Oracle, Pfizer, Bayer, Philips and more. “While the millennial generation is a frequent target for owners of residential communities, our demographic for this location are the 35 to 50 year-olds,” said Rieder, “they are highly skilled, educated, and very well compensated. It was no surprise to learn that the average household income at River Park is $119,000, or that Forbes ranked Somerset County as the 9th wealthiest county in the U.S.”

River Park’s focus on a thriving Central New Jersey business community differs with that of the Harbor Pointe acquisition. With its waterfront location, views of Lower Manhattan, and easy access to New York City, Harbor Pointe’s economic and employment focus is on the New York and New Jersey sides of the Hudson River, including Jersey City and Hoboken, with the millennial generation an important segment of that property’s demographic.

According to Cushman & Wakefield’s Brian Whitmer, who spearheaded the River Park sale, the multifamily sector is seeing strong investment demand overall. “Multifamily is benefitting from the demographic shifts in favor of apartment living – people in search of a more urban lifestyle and a waning desire to own,” he said. “Regional market fundamentals have remained strong and still point towards stability and positive rent growth. These are the reasons Northern New Jersey is on everyone’s radar. Active investors like CLP are targeting properties along the Hudson Gold Coast and west, following the train lines as they seek opportunities to either develop or buy existing communities in the towns serviced by rail.”

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About Castle Lanterra Properties

Founded in 2009, Castle Lanterra Properties focuses on identifying multifamily investment opportunities. The firm acquires, improves, repositions and manages a portfolio of properties across the Northeast, Mid-Atlantic and Southern U.S., with a proven track record of achieving above-market returns for investors. To date, Castle Lanterra Properties has acquired in excess of 4,500 residential units valued at $956 million.

About Cushman & Wakefield

Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop, and live. The firm’s 43,000 employees in more than 60 countries provide deep local and global insights that create significant value for occupiers and investors around the world. Cushman & Wakefield is among the largest commercial real estate services firms with revenue of $5 billion across core services of agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset management (DTZ Investors), project & development services, tenant representation, and valuation & advisory.

Based in East Rutherford, N.J., Cushman & Wakefield’s Metropolitan Area Capital Markets Group specializes exclusively in investment sales of office, industrial, multifamily and retail properties throughout New Jersey, New York, Fairfield County, Conn., Pennsylvania, and Delaware. The team has completed more than $21.7 billion worth of transactions since 2000, closing in excess of $2 billion in 2015. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

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