Frankforter Group Faces Foreclosure Notice at Downtown Atlanta Apartments

By Elias DaSilva | September 12, 2024.

The owner has defaulted on a $104.4 million mortgage. The Frankforter Group might be compelled to relinquish control of a downtown Atlanta apartment complex due to missed debt payments. Generations Atlanta, a 336-unit luxury apartment complex located at 369 Centennial Olympic Park Drive, is now facing foreclosure. The Montreal-based owner defaulted on a $104.4 million mortgage, as reported by the Atlanta Business Chronicle.

Arbor initially provided the loan, which was later transferred to Generations Property Owner LLC in May, according to Bisnow. The foreclosure notice indicated that the owner failed to make debt service payments for March, April, and May, and also neglected to maintain a $7.4 million reserve.

The foreclosure auction is set for September 3 at the Fulton County Courthouse. Generations Atlanta is a 17-story apartment complex developed by Kaplan Residential, based in Bay Harbor Islands, and was completed in 2020. It features studio, one-bedroom, and two-bedroom apartments, with convenient access to Centennial Olympic Park and the Georgia Aquarium.

Frankforter Group acquired the property in 2021 for $126.9 million, or $377,678 per unit, marking it as the largest multifamily sale in the submarket. The apartment complex gained attention in July when residents experienced days without running water following a water main break in the city, as reported by Fox5 Atlanta.

Frankforter Group also owns Garden Walk Apartments, a 240-unit complex near Hartsfield-Jackson Atlanta International Airport, and properties in South Florida, including Avery Pompano Beach, a 144-unit apartment complex in Pompano Beach.

With rising interest rates, some real estate investors have struggled to meet debt service obligations on floating rate loans secured during periods of low rates, particularly multifamily investors who purchased properties at peak values in 2021. Consequently, commercial foreclosures are increasing nationwide.

ATTOM’s latest commercial foreclosure report revealed that lenders initiated foreclosure proceedings for nearly 650 commercial properties in June, more than double the rate from the same month the previous year.