Two apartment properties in Forest Lake have been sold from the Gaughan multifamily portfolio for a combined $11.7 million late last week, according to public documents.
Two certificates of real estate value show that Forest Park II Apartments and North Shore Apartments were purchased by the Minneapolis-based group Millennium Management for $5.3 million and $6.4 million, respectively.
Vitality Apartment Communities will manage the properties, said Glen Rank, who said he will be temporarily the property manager. Rank said Vitality is owned by Millennium Management.
The North Shore Apartments, located at 1167 North Shore Drive, features two buildings, both with three floors and a total of 60 units. The property was built in 1971. The price works out to $107,083 per unit.
The Forest Park II Apartments, located at 1001 Seventh Ave. SW, also has three levels and 60 units, though it is one building. The property was built in 1974. The price works out to $87,916 per unit.
Rank said Millennium will upgrade the apartments to its standards and make “limited changes” but that specific plans for the properties don’t yet exist.
Rank said that Forest Lake is a growing market that’s underserved. North Shore Apartments, in particular, he said, was attractive because it is on the shoreline of Forest Lake.
“We’re always looking for opportunities to enhance our portfolio,” he said. “This was an opportunity to do just that.”
Both properties have had an increase in estimated market values since last year, according to Washington County property tax records. Forest Park had been valued at $6.8 million in 2023 but increased to $8.6 million in 2024. North Shore moved from $6.5 million in 2023 to $8.1 million in 2024.
The sale is the latest in the saga of Gaughan selling some of its multifamily properties. Another property, the Oakmont Apartments in Coon Rapids, sold earlier this month for $4.8 million. Esox Mgmt LLC owner Bryan Thompson confirmed to Finance & Commerce that he was the buyer.
JLL Managing Director Josh Talberg said in an interview last week that the Forest Lake-based Gaughan had many of the properties in the portfolio as “very long-term” investments. JLL has been facilitating the sale of the portfolio.
“A majority of this portfolio, they developed,” he said. “I suppose the most simple way to say it would be just as it would be at the end of its ownership life. Time to divest and put the proceeds elsewhere and allow new investors to come in.”
Talberg said the portfolio has been broken up and sold to a variety of buyers due to market demand, which he said is “not uncommon.”
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