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David Werner enters new contract with All Year

David Werner Real Estate Investments has entered into a new contract with All Year Management to buy a portfolio of Brooklyn apartments, putting the deal back on track after nearly falling apart. The terms of the deal have changed since Werner first agreed to acquire a 74-building portfolio for $346 million in March, according to the Commercial Observer.

  • Dig Deeper: Werner will now buy 68 buildings for $302 million in two separate transactions, one scheduled to close in July and the other in November. The first tranche of the deal includes 45 buildings for $176.6 million, and the second comprises 23 buildings at a purchase price of $125.8 million. 
  • Interesting deal structure: Under the new terms of the deal, All Year will contribute up to $29.6 million in preferred capital, at the buyer’s discretion, from the proceeds of the sale. The capital will carry a 6 percent interest rate and mature in June 2021, with two 12-month extension options at higher interest rates. In addition, it will be the buyer’s responsibility to facilitate the assumption of existing loans. Should the lender reject the loan assumption request, the purchase price will be reduced by 50 percent of the loan’s early repayment penalty. [CO]

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