Oct. 21--It wasn't easy when credit seems as scarce as hen's teeth, but Gary Brooks' Cornerstone Development bit off the largest property deal of the year by buying three apartment complexes for $44.5 million.

Cornerstone, under the name 1013 Properties LLC, bought the 368-unit Watersedge Apartments, 4317 SW 22, built in 1986; the 157-unit Gardens at Reding Apartments, 3708 S Douglas, built in 1985; and the 488-unit Oxford Oaks Apartments, 1920 E Second St. in Edmond, built in 1985.

Andy Burnett and David Burnett, brokers with Oklahoma City's Sperry Van Ness-William T. Strange & Associates, handled the transaction, which closed last week. The seller was SIA Partners in Santa Barbara, Calif.

"It certainly was a challenge. Obviously, we felt like our team could pull it off or we wouldn't have signed up," said Brooks, who has more than 20 years in the Oklahoma City commercial real estate market as a broker, property manager, developer and investor.

Unlike during the height of the property investment boom, financed largely by mezzanine debt, conduit loans and other arrangements as delicate, it turned out, as they were intricate, there was nothing fancy about the financing for this deal.

Confidence Multifamily lender Walker & Dunlop, based in Bethesda, Md., provided financing. Walker & Dunlop, founded in 1937, merged earlier this year with Credit Suisse Group subsidiary Column Guaranteed, through which Walker & Dunlop funds loans for the U.S. Department of Housing & Urban Development.

Brooks said he felt confident taking his investment plans to HUD and its Section 223(f) multifamily loan program, which insures long-term mortgages financed with Ginnie Mae securities.

"I knew the owners and I knew the properties," he said.

Ginnie Mae is the Government National Mortgage Association, owned by the U.S. government, which means the loan is backed by the full faith and credit of Uncle Sam.

"This was a tough deal to close given the current market conditions, but we had a lot of out-of-town investors chasing this portfolio due to the stability of the Oklahoma market," broker David Burnett said. Carla Curts at Capital Abstract handled the closing.

Andy Burnett said closing the deal less than five months after going under contract was "remarkable considering we paid off the existing Fannie Mae bonds and put in place a new HUD loan."

William T. Forrest, multifamily specialist with CB Richard Ellis-Oklahoma, said he was surprised the owners sold the properties since they are so stable and in such good shape. The owners were under no financial pressure to sell, Forrest said, and family concerns could have come into play.

The sale "shows the distinct shift in property fundamentals to more quality assets," said Mike Buhl of Norman-based apartment brokerage Commercial Realty Resources Co.

"These are the type of properties that are appreciating in today's market. This segment of the market -- 1980s vintage -- is really performing at its historical best despite the downturn in the economy and the softness we are seeing in the earlier 1970s vintage properties," Buhl said.

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