Dantes Buys Maryland Affordable Housing Complex for $139M
Dantes Community Partners, a majority minority-owned firm in Washington, D.C., has acquired Verona at Landover Hills, a 727-unit apartment community in Landover, Md. for $139 million.
The firm is the acquisition division of the Dumas Collective and focuses its efforts on acquiring existing, cash flowing assets with an emphasis on preserving affordable and workforce housing across the country.
The acquisition, from Dragone Realty Investments and GMF Capital was partially financed by $57 million from the Citi Emerging Manager Preservation Fund and Goldman Sachs (GS)’ One Million Black Women Initiative, which are both dedicated to supporting minority businesses. Additionally, Walker Dunlop provided a 10-year, $105 million fixed-rate loan at 4.47 percent, with interest-only payments for five years.
“It was a sizable asset in a submarket within the county that we were attracted to,” Sharif Mitchell, operating principal at Dantes Community Partners, told Commercial Observer. “The in-place rents were naturally affordable and provided an opportunity to preserve the rents in a market showing major rent growth.”
The development team will make nearly $30 million in renovations on the property and intends to make 100 percent of units to remain naturally affordable at or below 80 percent of Area Median Income in Prince George’s County.
“The in-unit renovation plan will focus primarily on replacing carpeting with luxury vinyl plank flooring, and upgrading appliances, cabinets, toilets, lighting, and bathtub glazing,” Mitchell said. “We will also be upgrading electrical systems, replacing all roofs, HVAC systems, adding dog parks, renovating the playgrounds and grilling areas, waterproofing, concrete and sidewalk repairs, paving the driveways, and adding security to the entryways.”
Additionally, as part of the company’s greening strategy, it will be replacing all lighting and water systems.
In partnership with Goldman Sachs, the project will expand social services at the building by bringing in resident services firm Equally Crafted Management. Services are expected to include academic tutoring, food supplemental services, financial literacy courses, community outreach and workforce training.
This summer, 60 percent AMI rents jumped to $1,602 for one-bedrooms, a 10 percent year-over-year increase, according to Dantes Community Partners.
“The average in-place rent at the [property] is $1,465,” Mitchell said. “Workforce rents continue to rise in the market which will continue to put pressure on the availability of affordable rents for this type of product.”
CBRE represented the seller in the deal. The buyer was not represented.
Keith Loria can be reached at Kloria@commercialobserver.com.