Biddeford apartment complex sells for nearly $2M over last year’s sale price

A little over a year after a 42-unit townhouse style apartment complex in Biddeford sold for $3.6 million, it found a new buyer who paid $5.45 million.

That’s an increase in the sales value of $1.85 million.

Honeytribe LLC bought 24 State St. from 24 State LLC in a transaction that closed Dec. 15.

Thomas Gadbois of F.O. Bailey Real Estate represented both the buyer and seller in the off-market deal.

The Southwood Court Townhouses, which dates to 1920, consists of four stories in a U-shaped 53,188-square-foot building with 34 two-bedroom townhouse units and eight three-bedroom townhouse units. There are 90 parking spots. The lot is 1.8 acres.

Gadbois was also the broker on the deal when the rental complex sold in September 2019.

At the time, he called the $3.6 million price tag big for Biddeford and a reflection of demand for housing in the city as prices rise in Portland.

Substantial renovations

The seller is a Connecticut resident whose real estate portfolio includes retail and residential properties throughout the U.S., said Gadbois. 

“He put a substantial amount of money into the property” in terms of renovations, which increase the property’s value, Gadbois said.

As units became vacant, renovations included remodeling them with new kitchens, bathrooms, flooring, paint and appliances, resulting in increased rents.

The average rent for renovated units in the building today is $1,600, Gadbois said. That compares with 2019, when rents were between $750 and $1,000, he noted.

Newer tenants are young professionals, he added.

“Anytime they put a unit up for rent, they get multiple inquiries,” Gadbois said. “There’s a lot going on in Biddeford.”

Plenty of upside

The buyer is a Maine investor who had reached out to Gadbois regarding another property. 

“I told him I had an off-market deal and I thought he’d be interested,” Gadbois said. “We put in an offer.” 

Even with the recent renovations, there’s still plenty of upside for the buyer, he noted. 

“He plans to take the building to the next level,” he said.

Plans include new landscaping, exterior paint, and continuing the renovations on units as they become vacant.

“It will be a good investment for him even at the price he paid,” Gadbois said.

Gadbois said that, in 2019, he was perhaps a little conservative in his projections for the property’s potential. 

“It exceeded my expectations,” he said. “The rent they got gave me a totally different outlook on the Biddeford market.”