A joint venture among PH Realty Capital, Alma Realty and Rockledge has secured $54 million of acquisition financing to purchase a portfolio of 10 rent-regulated multifamily buildings in New York City, Commercial Observer has learned.

Prime Finance provided the two-year, floating-rate nonrecourse loan on the sponsorship’s acquisition of the “Sentinel Portfolio” consisting of 10 apartment buildings throughout Manhattan and Brooklyn, according to Meridian Capital Group, which brokered the deal. The loan closed at an interest rate of 3.35 percent over the 30-day Secured Overnight Financing Rate, Meridian said. 

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The Sentinel Portfolio consists of 592 units with 80 percent of the apartments rent regulated. The JV acquired the multifamily assets from Sentinel Real Estate for $180 million, as CO previously reported..

Meridian arranged the transaction with a team led by Brian Flax, Morris Betesh and Jacob Schmuckler. 

“The collaboration and synergy between our team and the sponsors were crucial in navigating the complexities of the current market,” Betesh said in a statement. “This successful closing underscores the importance of having a well-coordinated approach and a deep understanding of the nuances associated with owning and managing rent-regulated buildings.”  

Flax said in a statement that the new owners of the Sentinel Portfolio are “uniquely qualified” to operate the properties in “today’s complex political and financial climate.” 

New York City rent-regulated properties have faced challenges in the last five years since state laws enacted in 2019 placed strict limits on future rent increases at rent-stabilized buildings. The property owners of these assets were also hit hard by the Federal Reserve aggressively hiking interest rates in early 2022 from near zero-level borrowing conditions up to more than 5 percent by mid-2023 during a period when many loans were scheduled to hit their maturity dates. 

Representatives at Prime Finance, PH Realty, Alma and Rockledge did not immediately return requests for comment.

Andrew Coen can be reached at acoen@commercialobserver.com.