Cortland grows portfolio with $104 million purchase of Clearwater apartments

For the second time this month, a Pinellas County apartment complex has sold for more than $100 million.

Cortland, an Atlanta-based multifamily real estate firm, bought Bainbridge Bayside, a 360-unit apartment complex at 19355 U.S. Highway 19 N. in Clearwater. US HWY 19N-FL Partners LLC, an entity associated with Cortland, paid $104.2 million for the property, according to a deed filed Tuesday in Pinellas County. The property has been renamed Cortland Bayside.

The seller was The Bainbridge Cos., a Wellington, Florida-based apartment developer that built the apartment community last year.

Cortland got a $68.12 million mortgage for the Clearwater property from Walker & Dunlop, property records show.

Cortland now has five communities with more than 2,600 apartment homes in the Tampa-St. Pete area, said Kyle Bateh, director of investments for Cortland’s Florida apartment communities.

“Pinellas County, in particular, has continued to prove itself as a resilient and promising growth market, even throughout the pandemic. We believe that the number of both public and private investments underway, including the roadway improvements designed to enhance access across the bay, will further open up this location to new demand and opportunity,” Bateh told the St. Pete Catalyst.

Cortland Bayside joins Trellis at the Lakes, with 688 apartments in north St. Petersburg, in hitting the nine-figure sales mark. Trellis at the Lakes sold for $114 million to Stoneweg US, a multifamily real estate investment firm in St. Petersburg, on Nov. 5. They are the two largest multifamily deals in Pinellas County in 2020, according to county records.

However, the per-unit price was dramatically different. Trellis, at 11401 Dr. Martin Luther King Jr. St. N. in St. Petersburg, was built in 1981 and recently renovated. It sold for about $165,700 per unit. Cortland Bayside, a newer property with waterfront views and luxury features, sold for $289,444 per unit.

That’s significantly higher than the average per-unit price of $158,714 for the Tampa-St. Petersburg-Clearwater metro market assets that traded through the end of August, according to a report from Yardi Matrix, a commercial real estate research firm.

A continued influx of new residents to the metro market is driving interest in apartment deals, the report said. The metro area added 282,000 residents between 2014 and 2019, an increase of 9.7 percent, which is well above the 3.1 percent national average. The area’s population is projected to reach 3.9 million in 2040, which would be 25 percent higher than it is now, the report said.

In addition, metro area rents were $1,291 on a trailing three-month basis as of August, below the $1,463 U.S. average, Yardi Matrix said.

The Florida multifamily market is weathering the Covid-19 pandemic better than most, Victor Ballestas, a principal with Integra Investors, said in the September Yardi Matrix report. “Vacancies remain low and collections were only a challenge for a few months. Low interest rates and the net migration to Florida contribute to the stability of the product,” Ballestas said.