Benzinga | Jun 28, 2021 04:17PM EDT

BRT Apartments Corp. Agrees to Sell Two Multi-Family Properties For $226M

BRT Apartments Corp. (NYSE:BRT) today announced that it entered into contracts to sell two multi-family properties, both of which are owned by an unconsolidated joint venture for approximately $226 million and expects to recognize its share of the gain, net of any prepayment penalty, of between $28 million and $30 million from the sale of these properties.

Jeffrey A. Gould, Chief Executive Officer and President commented, "The market for Southeast multi-family assets remains very competitive and we are pleased to execute on these sales to further BRT's focus on maximizing returns for stockholders and reducing our overall debt structure. We anticipate that proceeds from these sales will be used to retire debt and be re-deployed into the previously announced acquisition of our joint venture partners' interests in Bells Bluff, located in West Nashville, TN. We are excited about the Bells Bluff acquisition and will continue to look for acquisitions that meet our underwriting criteria. We are navigating a challenging acquisition market; however, we remain focused on our unique ability to buy out our joint venture partners and pursuing accretive acquisitions as we create value for our stockholders."

These properties, Parc at 980, a 586 unit property located in Lawrenceville, GA and The Avenue Apartments, a 522 unit apartment located in Ocoee, FL, are being sold for $118.3 million and $108.0 million, respectively. Both properties are owned by an unconsolidated joint venture in which BRT has a 50% interest. The aggregate debt on the properties is $107.5 million which will be repaid or assumed by the buyers.

Net proceeds to BRT after the repayment of such debt, the mortgage prepayment charge and closing costs are estimated to be approximately $46 million. These transactions, which are subject to customary closing conditions, are expected to close by the end of the third quarter.

BRT also announced it is under contract to sell to its joint venture partners BRT's 76% interests in the unconsolidated subsidiaries that own The Tower at Opop and Lofts at Opop, with an aggregate of 181 units located in downtown St. Louis, Missouri, for $3.0 million. BRT will recognize an impairment charge of approximately $510,000 in the second quarter. The aggregate mortgage debt on these properties total $26.2 million.

During the year ended December 31, 2020, these four properties generated an aggregate of $929,000 of equity in loss from unconsolidated joint ventures, including an aggregate of $3.6 million of depreciation and $3.2 million of interest expense.

These transactions are subject to customary closing conditions.