Berkadia Lands Preferred Equity for Novu's 308-Unit Garden-Style Apartment Project in Jacksonville

Novu Residential Group Secures $13.1 Million for Jacksonville Multifamily Development

Novu Residential Group, a Birmingham-based firm specializing in sourcing, building, and managing residential communities in the Sun Belt, has successfully secured $13.1 million in preferred equity for a 308-unit multifamily development in Jacksonville, Florida.

Key Project Details

The groundbreaking for the project occurred in November, marking the commencement of construction on a 15.41-acre site at 1485 Fouraker Road. Positioned just west of Interstate 295, the property offers proximity to major employers such as Amazon, Boeing, and Wayfair. Additionally, quick access to I-10 ensures a short commute to downtown Jacksonville and nearby beaches.

The apartment complex, featuring eight garden-style buildings, aims to provide a high-quality living experience with resort-style amenities, including outdoor living and recreation areas. Notably, the community is conveniently located within walking distance of shopping centers anchored by Publix and Winn-Dixie.

Berkadia Facilitates Preferred Equity Commitment

Berkadia played a crucial role in obtaining the preferred equity commitment from an undisclosed real estate investment firm specializing in ground-up development. Novu CEO Patrick Jackson emphasized that the investor would serve as a long-term strategic partner for Novu.

The deal was orchestrated by Managing Directors Cody Kirkpatrick and Noam Franklin, along with Senior Managing Director Chinmay Bhatt of Berkadia JV Equity & Structured Capital.

Preferred Equity's Growing Popularity

As a financing source, preferred equity has witnessed a resurgence, with developers and owners increasingly turning to this option amid challenges posed by the scarcity of capital for multifamily deals. The trend is evident in Berkadia's involvement in several such deals in recent months.

In October, the Berkadia team assisted Wilkinson Corp. in securing $13 million in institutional equity for the acquisition of Legacy Park, a 250-unit multifamily property in Brownsburg, Indiana. Berkadia Senior Managing Director Richard Levine also secured a nearly $30 million loan from Freddie Mac for Wilkinson as part of the comprehensive financing package.

Last spring, the team secured $24 million in preferred equity for Bela Flor Communities, contributing to the recapitalization of Bella Victoria, a 236-unit luxury multifamily asset in Mesa, Arizona.