Manoucheri Brothers Acquire 153-Unit Summerfield Apartments in Sunrise for $30.4M

Key Takeaway

• Manoucheri Brothers acquired the 153-unit Summerfield Apartments in Sunrise for $30.4 million, assuming an $18.3 million Fannie Mae loan at a 4.8% fixed rate.
• The acquisition is part of their strategy to buy properties with low fixed-rate mortgages; they aim to own 10,000 units in Florida, currently holding close to 1,000 units worth nearly $250 million.
• Renovations and upgrades are planned for Summerfield Apartments to increase rents from the current $2,000 per month for two-bedroom units by several hundred dollars.

Manoucheri Brothers Expand in South Florida

The Manoucheri Brothers, a Los Angeles and Aventura-based family office, have significantly expanded their South Florida multifamily portfolio by acquiring the 153-unit Summerfield Apartments in Sunrise for $30.4 million. This acquisition, which includes the assumption of an $18.3 million Fannie Mae loan at a fixed rate of 4.8 percent, marks their largest purchase in the tri-county region. The family office, led by siblings Aaron, Avi, and Yosef Manoucheri, has been actively investing in Florida since 2020, with a goal to acquire 10,000 apartments across the state. This latest addition brings their Florida portfolio's value close to $250 million.

Strategic Acquisition and Financing

The Summerfield Apartments deal is particularly notable for its strategic financial structuring. The Manoucheri Brothers assumed a nine-year Fannie Mae loan with a favorable fixed rate of 4.8 percent, a significant advantage in today's high-interest-rate environment where fixed-rate mortgages are typically between 6.5 to 7 percent. This financial maneuvering not only made the deal more attractive but also aligns with the family's strategy of acquiring properties with assumable low fixed-rate mortgages. The property, consisting of six two-story rental buildings and a clubhouse, will undergo renovations to increase rental income, with current two-bedroom units leasing for $2,000 per month.

South Florida's Multifamily Market Dynamics

The acquisition of Summerfield Apartments by the Manoucheri Brothers is set against a backdrop of a dynamic multifamily market in South Florida. Despite a nationwide slump in multifamily financing due to tighter bank lending and elevated interest rates, the region continues to see significant investment activity. For instance, Ares Management recently completed the largest multifamily purchase in South Florida this year, acquiring the 284-unit Ceru project in Boca Raton for $139.7 million. Additionally, Vantage Capital Partners acquired the 108-unit San Sherri Apartments in Hialeah for $20.6 million. These transactions highlight the ongoing demand and investment interest in South Florida's multifamily sector.

Broader Implications for the Real Estate Sector

The Manoucheri Brothers' strategic acquisition and financing approach reflect broader trends in the real estate sector, particularly in high-demand markets like South Florida. The ability to secure low fixed-rate loans and the focus on value-add opportunities are key strategies for navigating the current economic environment. This approach not only enhances the financial viability of acquisitions but also positions investors to capitalize on rental income growth through property upgrades. The continued investment in multifamily properties, despite financing challenges, underscores the resilience and attractiveness of this asset class in South Florida.

Management Quotes

• Aaron Manoucheri, Manoucheri Brothers:

  "We are getting close to 1,000 units and we have another 9,000 to go. [Including Summerfield Apartments], our Florida portfolio is worth close to $250 million."
  "We sourced it off-market. We got a phone call about this opportunity, and we had been researching this market for some time. It fits like a glove."
  "Today, deals are going out at 6.5 to 7 percent with a fixed-rate mortgage. It is out of control. We are very pleased and thankful to God for sending us this deal."
  "Right now, two-bedroom units without putting a dollar into them are leasing for two grand a month... We will probably push that up by a couple hundred dollars or so after implementing our value-add program. We found a gem in a haystack."