Optimus Acquires 152 Condos in Scottsdale
Optimus US Real Estate Fund is pleased to announce that it has completed the acquisition of 152 condos at The Allison Condominium in Scottsdale, Arizona for a purchase price of $19,000,000 plus closing costs. The amount equates to $125,000 per unit. The purchase was funded with a combination of $9 million in equity with a $10,000,000 loan secured by a deed of trust (first mortgage) from B2R Financial LP – a wholly owned subsidiary of the Blackstone Group – at a variable rate of 4.50% over LIBOR (London Interbank Overnight Rate), LIBOR is currently at 0.25%, giving a floor interest rate of 4.75%. The terms include interest-only payments, a three year term, with two one year extensions the option of the borrower (the Fund’s subsidiary Optimus Allison Borrower LP), and also required the Fund to purchase an interest rate cap policy that limits the maximum interest rate at 7%, in case of a significant rise in LIBOR interest rates.
The Allison is comprised of 332 condos in total, and is located on 11245 – North 92nd St, Scottsdale, in a fully developed, and an amenities-rich area close to the 101 State Highway, which is a major arterial freeway and an integral part of the Greater Phoenix Area “Loop” system. The units average 955 sq. ft including 81 one-bedroom units, and two configurations for the remaining 71 two-bedroom two-bath units, with all units having been upgraded with granite counter tops, wood cabinets and ceramic tile flooring.
Grant Sardachuk, Managing Director of US Operations described the acquisition as, “An excellent purchase by the Fund, in an upscale, mature part of Scottsdale, priced well below current retail sales averaging close to $170,000 per unit”. Arthur Wong, Managing Director and CEO commented, “The purchase met with all of the Fund’s investment criteria, and shows that with persistent and careful research in conjunction with our property managers, TM Real Estate Group, that there are still high-quality opportunities for the Fund to deploy its remaining capital.”
The Optimus US Real Estate Fund is a prospectus-exempt, open-ended private mutual fund trust that was designed to take advantage of the unprecedented downturn in US real estate prices. Designed with investors in mind, the Fund optimizes both Canadian and US tax treatments and is RRSP eligible. The highly skilled and dedicated management team has more than $3 billion in real estate acquisitions and financing experience.
Certain information in this release is forward-looking and related to the anticipated financial performance, events and strategies of the Optimus U.S. Real Estate Fund and its operating subsidiaries. All statements other than statements of historical fact are forward-looking statements. These involve known and unknown risks, uncertainties, assumptions and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information.
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