Source: San Francisco Business Times
Friday, March 23, 2012 by Mark Calvey, Senior Reporter
Bayside Communities’ Michael Barker prefers tackling complex deals that might scare off others.
But even he may have been surprised by the sheer number of challenges when his firm bought bankrupt A.F. Evans’ affordable-housing multifamily portfolio and its property management arm with 300 employees. The acquired holdings, including 29 properties totaling almost 3,000 affordable housing units, were valued at about $280 million, Barker said.
Oakland-based Bayside wouldn’t say what it paid for the portfolio, but did say the value of the properties has exceeded its conservative assumptions since the deal closed in April 2011.
“I like complicated deals,” said Barker, managing director of the Barker Pacific Group, which is a partner, along with Luzzatto Co. and Lion Real Estate Group, in Bayside Communities.
Complicated might be an understatement. The transaction involved getting agreement from more than 140 parties, including lenders, public agencies and major corporations holding tax credits in various affordable housing communities. A.F. Evans was a successful affordable housing developer that moved into market-rate housing, placing bets just as the housing meltdown occurred. A.F. Evans filed for Chapter 11 in 2009.
Bayside began looking at the portfolio in February 2010 and had a contract to buy the portfolio in October 2010, reflecting how long it took to bring a deal together.
“We created a war room to keep track of each property and the investors that needed to sign off on our becoming the general partner,” Barker said. “I could go on for hours about the complexity of it all.”
Location: Throughout the western United States, including San Francisco.
Size: 29 affordable housing multifamily properties, with almost 3,000 units.
Buyers: Bayside Communities. (A partnership of Barker Pacific Group, Luzzatto Co. and Lion Real Estate Group.)
Seller: A.F. Evans Co.