BRIDGEWATER, NJ – The KRE Group, a full-service real estate investment and management company with more than five decades of experience, announced today that it has acquired Summit Hill, a 228-unit rental community in Springfield, NJ for $70 million, in partnership with Avenue Realty Capital, a real estate investment firm focused on multifamily and mixed-used properties in the New York metropolitan area.
Summit Hill, located at 100 Stone Hill Road, is a garden style apartment community tucked away in a wooded setting near the nexus of Routes 78 and 24 in western Union County. It is the latest of three garden apartment acquisitions totaling over $222 million that KRE has completed in 15 months, comprising over 1,065 apartment units.
The Summit Hill acquisition is part of a strategic initiative KRE has launched to substantially grow its “value-add” multifamily business. The company purchased Deer Creek, a 288-unit rental community in Plainsboro, NJ, for $45.5 million in February, 2016, and Royal Gardens, a 550-unit rental property in Piscataway, NJ, for $107.25 million in November, 2015.
Like Deer Creek and Royal Gardens, KRE sees its acquisition of Summit Hill as an opportunity to enhance tenant quality of life and increase the property’s value through capital improvements.
“The common thread in all three of these assets is they are well-located properties in high-demand, supply-constrained markets, and they all offer the opportunity to create value through investments in capital improvements, unit renovations and improved property management,” said Darin Raiken, Director of Acquisitions for The KRE Group. “We have already had considerable success implementing this strategy at Deer Creek and Royal Gardens, and we identified Summit Hill as a property with similar potential.”
Summit Hill has historically been a well-occupied community, with average occupancy rates in the mid to high 90 percent range. It is situated in a scenic hillside location atop Baltusrol Mountain with walking paths, tree-lined streets, an outdoor pool and a tennis court. As part of the property upgrades, the KRE/Avenue partnership plans to build a brand new clubhouse and state-of-the-art fitness center.
Steve Scioscia, co-founder of Avenue Realty Capital (ARC), said, “we are very pleased to joint venture with KRE as our operating partner and specifically with this investment as it fits perfectly in our value-add multifamily investment strategy in the New York Metropolitan Area. It is a valuable addition to our growing portfolio.” Avenue Realty Capital has been an active investor in the multifamily and mixed use segment of the market in New York over the last three years. This is the 36th property funded by ARC through its equity investment platform.
KRE has a number of additional upgrades planned for its recent garden apartment acquisitions, some of which are well underway. The company will renovate unit interiors, including the addition of new kitchen and bathroom finishes and washer/dryers. It is also initiating major capital improvements such as new roofs, parking and sidewalk repairs, and landscaping upgrades.
“Since beginning this strategic initiative, we have deployed more than $222 million in acquisition capital and we continue to actively seek out new opportunities,” said Jonathan Kushner, President of The KRE Group. “As the New Jersey rental market continues to evolve, we believe this is a component of the market that is poised for incredible growth.”
KRE, a Bridgewater-based company, is also one of the most prolific real estate developers in the region. KRE recently debuted two iconic communities on New Jersey’s Gold Coast, “Journal Squared”, which will ultimately comprise 1,838 luxury rental residences and 36,000 square feet of retail space in Jersey City’s historic Journal Square neighborhood, and “Hudson Lights”, a one million square foot development just two blocks from the George Washington Bridge in Fort Lee that features 276 luxury rental residences, amenities, restaurants, shops and an iPic movie theatre. Other prominent KRE developments include Grove Pointe, 225 Grand, and 18 Park in downtown Jersey City, and Madison Farms, a 100-acre mixed-use property in Bethlehem Township, Pa. that will ultimately include 837 luxury residences and 153,000 square feet of retail space. KRE will also debut new residential buildings in Madison, NJ and Jersey City’s Hamilton Park neighborhood in 2017.
About The KRE Group
Headquartered in Bridgewater, NJ, KRE Group is one of the largest privately held diversified real estate companies in New Jersey. It owns and manages more than 6,000,000 square feet of office, warehouse and retail space. It also has a multi-family portfolio which exceeds 9,000 existing apartments, with an additional 7,500 in various stages of approval and construction. For more information, visit the company’s website at www.thekregroup.com.
About Avenue Realty Capital
Avenue Realty Capital is a real estate investment firm focused on middle market multifamily and mixed-use properties throughout the New York metropolitan area of New York, New Jersey and Connecticut. Avenue provides equity capital and expertise to local operating partners for the acquisition, development and repositioning of real property.