Bluerock Value Exchange, a sponsor of 1031 exchange offerings, has sold Beach House, a 228-unit multifamily community located in Jacksonville Beach, Florida for $67.3 million.
The property was originally purchased by BR Beach House DST, a Delaware statutory trust program, in April 2016 for approximately $51.8 million. The property sold for $67.3 million in October 2021, resulting in a 165 percent net total return on equity investment, including distributions, and an approximate 12 percent average annual return.
Bluerock noted that the full-cycle event included an equity return of approximately $29.9 million on a $21.6 million initial investment, or an approximate 139 percent net gain on sale. In addition to the capital appreciation, the property paid monthly distributions averaging 4.8 percent per year totaling nearly $5.7 million, bringing the total return to 165 percent.
“We are very pleased to have delivered double digit annual returns to investors and a liquidity event ahead of our forecast,” said Josh Hoffman, president of Bluerock Value Exchange. “In addition to consistently sustaining high occupancy rates, we successfully completed a number of value-add initiatives over the investment period which we believe created tremendous upside resale value including complete exterior repainting, landscaping upgrades, new signage, fitness center upgrades, common area upgrades and improvements, as well as 29-unit renovations which alone generated an approximate 19 percent return on investment.”
Built in 2009, Beach House is comprised of one-, two-, and three-bedroom floorplans and is within walking distance to the beach, hiking and biking trails, and dining, shopping, and entertainment destinations.
Bluerock Value Exchange focuses on Class A assets and has structured 1031 exchanges on more than $2 billion in total property value and approximately 11 million square feet of property.