- Foulger Pratt acquired a four-property, 1,248-unit multifamily portfolio from AvalonBay Communities for $447M, averaging $358K per unit with a 5.94% in-place cap rate.
- Three of the four properties—two in NoMa and one in Gallery Place—have closed, while the 138-unit AVA H Street is expected to close soon.
- The acquisition aligns with Foulger Pratt’s strategy to buy high-quality assets at a discount, as DC’s new supply slows and rent growth potential increases.
A Strategic Bet On DC Multifamily
Foulger Pratt, based in Potomac, MD, has completed a major multifamily acquisition in Washington, DC, reports Bisnow. The firm purchased four apartment buildings from AvalonBay Communities in a deal valued at $447M. The properties span top neighborhoods including NoMa, Gallery Place, and H Street.
Three of the buildings—Avalon at Gallery Place (203 units), Avalon First and M (469 units), and AVA NoMa (438 units)—have closed, totaling 1,110 units. The fourth, AVA H Street (138 units), is under contract and expected to close shortly.
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Property Breakdown
- Foulger Pratt bought Avalon at Gallery Place for $86M and used a $59.4M loan from Capital One to finance the deal. The building is now called The Esquire on Fifth.
- Avalon First and M (now Mira First & M) and AVA NoMa (now Slate at NoMa) sold for $182M and $142M, respectively.
- The final piece, AVA H Street, is being acquired for $36M in partnership with PCCP and Tryline Capital.
Foulger Pratt bought three properties that are 95% leased and is starting a value-add renovation program across the portfolio.
Market Timing And Strategy
Foulger Pratt CFO Joe Clauser said the firm bought the portfolio at a “significant discount to replacement cost.” He added that the deal offers potential upside due to DC’s slowing new construction pipeline and strong market fundamentals.
The portfolio includes ground-floor retail tenants like Starbucks, Andy’s Pizza, and Streets Market, adding further appeal.
Regulatory Hurdles
The deal also highlights the complexities of DC’s Tenant Opportunity to Purchase Act (TOPA). Tenants at three of the buildings didn’t exercise their rights under TOPA. However, tenants at AVA H Street formed an association and assigned their rights to Foulger Pratt and its partners, allowing the deal to move forward.
AvalonBay, which had flagged these dispositions during a July earnings call, now retains 1,516 apartment units in DC, down from 2,764 before the sale.
Looking Ahead
This acquisition brings Foulger Pratt’s total DC portfolio to 2,904 units and expands its national footprint to 7,755 units. The firm is working with institutional-grade assets in strategic locations. Combined with a clear value-add strategy, Foulger Pratt is positioning itself for long-term gains in the nation’s capital.
