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The Preserve at Owings Crossing sells for $77M

The $77.25 million sale of the Preserve at Owings Crossing in Reisterstown was announced on Wednesday.

Chicago-based Waterton Associates LLC sold the garden-style community, the 14th largest apartment community in the Baltimore area, to Pennsylvania-based Morgan Properties. Jones Lang LaSalle represented the seller in the transaction.

“When [Waterton Associates LLC] purchased the property they had intended to do a significant renovation to the community, but then, as we say in the business, the world fell apart. Recession happened, not really a lot of opportunity to renovate units and increase rent,” said Christine Espenshade of JLL Mid-Atlantic’s Multifamily Group.

The Preserve at Owings Crossing has 791 units in 68 buildings and totals 694,110 square feet. The property was built in 1965 and since 2006 has undergone $5.6 million in capital improvements that include building a leasing center on site, upgrading the fitness center and performing some small amenity work.

“It was really time to sell. They wanted to take advantage of significantly low cap rates in the market still, and I think that they understood that value-add properties, of which this was definitely one, are very popular in the market right now,” Espenshade said. “Investors are out there looking for slightly higher yield, and being able to purchase a property of this scale gave quite a few investors an opportunity to look at it and think about what they might do to upgrade the units and increase rents.”

The apartments are located near the Owings Mills area in northwestern Baltimore County that has seen large investment in development projects in recent years, in part being driven by its designation as an intended growth area by the county. In 2014, northwest and west Baltimore County experienced 3 percent rent growth, the largest such rise in the Baltimore metro market, according to a Delta Associates’ year-end report.

Foundry Row, which will include 365,000-square-feet of retail space and 60,000-square-feet of Class A office space, is located less than four miles south on Reisterstown Road and not far from the transit oriented development Metro Centre at Owings Mills that is under construction. The Preserve at Owings Crossing is located near the Owings Mills Metro Station that also provides a rail line directly to downtown Baltimore.

“The buyer did finance the building with a Freddie Mac loan, and while the buyers are very familiar with the market and the dynamics, being able to get a low-interest, high-quality loan from one of the agencies — being able to tell the story about the overall growth in the area is very important,” Espenshade said.

About Adam Bednar

Adam Bednar covers real estate and development for The Daily Record.