Cottonwood Communities Buys West Palm Beach Multifamily Property
June 12, 2019 | James Sprow | Blue Vault
Cottonwood Communities, Inc., a publicly registered non-traded real estate investment trust, has closed on its acquisition of Luma at West Palm Beach (“Luma”), a luxury 245-unit multifamily community located in West Palm Beach, Florida for a purchase price of $67 million.
Completed in 2018, Luma is located five miles west of Palm Beach International Airport and is comprised of a mix of one-, two-, and three-bedroom units with an average size of 1,122 square feet. Property amenities include gated access, heated resort-style pool with cabanas, fitness center, 5,500-square-foot clubroom, business center and dog park.
In conjunction with the acquisition, a $36 million loan was secured through Fannie Mae, representing a 54% loan-to-purchase price ratio, with a 10-year term at a 3.93 percent fixed rate, interest only for the full-term.
“We are pleased with our first acquisition,” said Enzio Cassinis, CEO of Cottonwood Communities. “We believe that the acquisition of Luma aligns very nicely with our philosophy of investing in quality assets and enduring locations using a conservative leverage strategy.”
According to the Company’s press release:
“Situated on a prominent West Palm Beach thoroughfare and less than a mile from a major toll-road and highway, the property offers convenient access to some of South Florida’s largest job centers. Major employers in the area include Florida Power & Light’s national headquarters, the Scripps and Max Planck Research Institutes, Palm Beach Atlantic University, Palm Beach Gardens Medical Center, Wellington Regional Medical Center, Palms West Hospital, Pratt & Whitney and United Technologies.
A multitude of shopping, dining, entertainment and recreational destinations are also just minutes from the property, including a 140-store outlet shopping center known as Palm Beach Outlets, Trump International Golf Club, Mounts Botanical Garden, an upscale lifestyle shopping center and movie theater at CityPlace in Downtown and some of Florida’s beautiful beaches.”
Cottonwood Communities, Inc. registered an offering with the SEC on August 13, 2018 for up to $750 million in shares of common stock, priced at $10.00 per share, all without any upfront costs or expenses charged to the investor. Any offering-related expenses will be paid by the advisor without reimbursement by the REIT. The offering broke escrow on December 18, 2018. Through March 31, 2019, the REIT had cash flows from provided by financing activities, primarily from the net proceeds received from the issuance of common stock, of $15.1 million. The REIT paid distributions to shareholders totaling $58,045 in the first quarter of 2019.
Sources: Cottonwood Communities, Inc., SEC
Learn more about Cottonwood Communities, Inc. on the Blue Vault Investment Manager page
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