Passco Companies, a privately held California-based commercial real estate company that specializes in acquisition, development, and property and asset management throughout the U.S., has acquired Legacy on the Bay, a 300-unit luxury apartment community in Destin, Florida for $63.45 million.
This is Passco’s second multifamily asset acquisition in Destin in recent months, coming on the heels of the firm’s purchase of Class AA Sea Glass Apartments in December, according to Colin Gillis, Vice President of Acquisitions for Passco.
“We’ve enthusiastically targeted the Crestview-Fort Walton Beach-Destin MSA for its strong track record and future economic expansion potential, as it continues to post the lowest unemployment rate in the state of Florida,” explains Gillis, also noting that Moody’s Analytics places the area in the top 10th percentile nationally for projected job growth over the next five years. “Additionally, this market continues to have extremely high physical, political, and financial barriers to entry. There is only one multifamily asset in the pipeline in the entire MSA, despite significant in-migration and a population growth rate of more than twice the national average.”
Legacy on the Bay is located near U.S. Highway 98 and U.S. Highway 331, offering residents superior regional access, and has proximity to major employers including Fort Walton Beach Medical Center, Northwest Florida State College, and BAE Systems. There has been a large influx of jobs in the leisure and hospitality industry driven by tourism to the ‘Emerald Coast,’ known for its white sand beaches and emerald green waters, which attracts approximately 4.5 million visitors each year.
“Due to our ownership of best-in-market Sea Glass Apartments, located just a few miles down the road from Legacy, we already have our finger on the pulse of the local market and resident demands,” says Gillis. “Thus, we are better positioned to strategically approach the operation of this asset. Through adding this core-plus investment to our portfolio, we will hold two distinct and in-demand offerings in Destin.”
The firm plans to implement value-add upgrades at the property, including minor renovations to refresh and modernize interiors and the addition of in-unit washer/dryers. Gillis also highlights that the property features the largest floorplans in the submarket, including a rare four-bedroom option.
“Legacy’s spacious one, two, three, and four-bedroom floorplans are well-suited to its location, which offers tranquil living surrounded by lush greenery,” confirms Gillis. “Further, the larger floor plans are appealing to families who are drawn to the Okaloosa County School District, one of the top five districts in the state.”
Gillis notes that Legacy’s residents also enjoy quick access to several shopping, dining, and entertainment options, including a Whole Foods Market, Bass Pro Shops, Belk, H&M, Chipotle, and 14-screen AMC Theatre at Destin Commons.
Legacy’s units include screened balconies and patios, stainless steel appliances, deep kitchen sinks with upgraded spray hoses, custom cabinetry, refrigerators, dishwashers, built-in shelving, walk-in closets, ceramic-tiled foyers, security alarms, air conditioning, and ceiling fans with brush nickel accents.
Competitive community amenities include a resort-inspired swimming pool, a 24-hour fitness center, a tennis and basketball court, a clubhouse, a business center, laundry facilities, garage and carport parking options, a community playground, and a dog park.
The firm acquired Legacy at the Bay from Carter-Haston Real Estate Services, a Nashville-based private fund and property management firm. Brian Moulder and Dhaval Patel of Walker & Dunlop represented the seller in this transaction.
“Legacy on the Bay presents a unique, high-yield investment opportunity due to its location less than a mile from some of the most desirable beaches in the country, and two miles from the thriving Destin Commons, a premier lifestyle center offering residents shopping, dining, and entertainment,” says Moulder. “This will remain a strong overall investment as it matures. It was a pleasure to work with Passco’s dependable team once again on this transaction.”
Passco has been extremely active in the Florida multifamily market in recent years, amassing a current portfolio of 12 properties in the state.
The apartment community is located at 251 Vinings Way Boulevard in Destin, Florida.
Chris Black and Caleb Marten of KeyBank Real Estate Capital’s Commercial Mortgage Group arranged acquisition financing on behalf of Passco Companies.
