Bortz and Jonas of Kislak complete $5.05 million sale of Vassar Gardens Apartments

Poughkeepsie, NY The Kislak Company, Inc. arranged the sale of Vassar Gardens Apartments, a complex with 60 residential units for $5.05 million.  The sale price per unit was among the highest in the local market at $84,000. Vice presidents Janet Bortz and Andrew Jonas represented the parties in the transaction. Vassar Garden Apartments is a 60-unit, two-story garden style apartment complex. The property includes 24 three-bedroom units, 20 two-bedroom units and 16 one-bedroom units, totaling 53,800 rentable s/f. Bortz sold the property ten years ago and led Kislak’s recent efforts to market and sell it on an exclusive basis. Her long-term involvement and success in the market enabled her to provide the current purchaser with comprehensive market information, comparable sales and the property’s history. According to Bortz, the active market in the area meant that price was not a point of contention. “The property sold very close to the listing price, which demonstrates the strength of the market,” said Bortz. “The buyer has an upside with rental increases and possible repositioning. The property has historically been close to full occupancy over the seller’s 10-year ownership.” An important feature of the transaction was that it was a part of an Internal Revenue Code Section 1031 tax-deferred exchange, which allows for deferment on the payment of capital gains taxes when the proceeds from a qualifying property sale are reinvested in the purchase of another similar property. The deferment frees equity from the sale of one property for use in the purchase of another similar property. In addition to equity preservation, investors use this approach for several reasons: Leverage: The exchange can facilitate the purchase of a much larger property with equity and some financing; Diversification:  The exchange can be made for property in a different geographic area or one that has a different purpose (for example, retail to multifamily); and Management Relief: Executing the exchange to acquire property that includes on-site management for a more hands-off role. IRC Section 1031 tax deferment helped make the Vassar Gardens sale possible, and the new owner has plans for improvements on the 60-unit complex, which is just a few blocks from Vassar College in Poughkeepsie. “The buyer and seller worked together to make the transaction as stress-free as possible for everyone,” said Jonas. “The buyer plans to significantly upgrade the property inside and out.”