Northmarq’s Richmond investment sales office completes $51 million sale of Cottage Grove Apartments in Newport News, Virginia

Acquisition financing of $42.72 million was secured by the Richmond debt/equity team via a bridge loan

RICHMOND, VIRGINIA (February 21, 2022) – Wink Ewing, managing director, Mike Marshall, managing director, Matt Straughan, associate and Jared Alcorn, senior analyst on Northmarq’s Richmond investment sales team collaborated to arrange the $51 million sale of Cottage Grove Apartments. The class C+ multifamily property (originally built in 1948 and renovated in 2009) contains 112 buildings/552 units ($92,400 PPU) and is located at 614 Peninsula Drive in Newport News, Virginia.  Northmarq represented both the buyer, Featherstone Partners and the seller, Beachwold Residential.

Featherstone intends to reposition the asset with enhanced amenities and operational improvements through new management, selecting Drucker & Falk for property management. The company commented on the acquisition, “the employers in Newport News play a major economic role in not only the Hampton Roads region but also on the national defense stage. We are proud to have an asset that the surrounding workforce will call home

“This opportunity presented a blank canvas with tremendous upside for the buyer as the property was built with great bones and has a neighborhood feel that nearby competitors lack,” said Ewing. “At the time of closing, new leases were seeing 20%+ trade-outs and occupancy was at an all-time high.”

Hunter Wood, vice president of Northmarq’s Richmond debt/equity team, secured acquisition financing of $42.72 million for the property via a bridge loan. Northmarq arranged financing for Featherstone Partners through its relationship with a bridge/mezzanine lender. “Northmarq had an established relationship with the borrower, which helped move the deal through closing on an expeditated timeline,” said Wood. 

The property benefits from a “Goldilocks” location—it is in one of the more affordable housing markets in the Newport News metro area, adjacent to Newport News Shipbuilding, while only being two miles west of Downtown Hampton. Residents have just a short drive to Peninsula Town Center/Hampton Coliseum, a top retail/shopping destination. 

Cottage Grove Apartments is situated within three institutions of higher learning: Christopher Newport University (6.3 miles), Thomas Nelson Community College (6.5 miles) and Hampton University (7.4 miles). Other nearby points of interest include: Buildbird Gap Farm (4.2 miles), Noland Trail at Mariner’s Museum Park (5.1 miles), Mariner’s Museum (6 miles), Virginia Living Museum (6.1 miles) and Fort Monroe National Monument (9 miles). 

Apartment amenities include: High-speed internet access, in-unit washer/dryer, air conditioning, heating, ceiling fans, smoke free, cable ready, tub/shower, oven, range, refrigerator and freezer. Community amenities include: Laundry facilities, maintenance on site, property manager on site, renters insurance program, online services, planned social activities, health club discount, business center, pool, playground and courtyard. 

The sale and financing of Cottage Grove Apartments follows on the heels of multifamily markets rebounding from the pandemic, according to Northmarq’s recent National Multifamily Outlook. Investors were attracted to the sector’s explosive rent growth, tight vacancies, spiking absorption and strong migration trends. Investors like Featherstone Partners are recognizing attractive yields in multifamily that may be difficult to achieve elsewhere. Read more about the demand-supply imbalance fueling staggering rent growth, tight vacancies and robust investment opportunities in Northmarq’s Multifamily Outlook.