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Bascom Buys 2nd Apartment Complex in Arizona

Irvine-based apartment investor Bascom Group LLC has made a $55 million push into Arizona’s multifamily market during the past month, and officials say the company is eyeing more deals in the region.

An Arizona-based affiliate of the company announced earlier this month that it bought the Coldwater Springs Apartments, a 301-unit community located in Avondale, Ariz.

The complex traded hands for $27.2 million, or about $90,000 per apartment. Ares Management LLC, which has a Newport Beach office, provided debt financing for the purchase.

Coldwater Springs was built in 2007. The complex is located on 16.5 acres of land and has apartments averaging 956 square feet.

The Coldwater Springs deal comes on the heels of Bascom paying $27.9 million for the 330-unit Estates on Maryland apartment complex in Phoenix, a deal announced last month.

Bascom reportedly partnered with Morgan Stanley on the Estates on Maryland buy, which traded hands at about $84,500 per apartment. Local reports listed Santa Monica-based Colony Capital as the seller of the Estates on Maryland property, which it was said to have bought in 2006 for $39.5 million.

Mesa West Capital of Los Angeles is said to have provided about $21 million in financing for the Phoenix purchase.

The two purchases are the first in the Arizona region for Bascom and its affiliates in nearly five years. Bascom previously acquired almost 5,200 units in the Phoenix area between 2004 and 2006.

Local reports said five Phoenix properties owned by Bascom Arizona Ventures were foreclosed upon in 2009.

“We feel now is the best time to buy back into the Arizona region,” Mark Brotherton, asset manager for Bascom Arizona Ventures, the company’s Scottsdale-based affiliate, following the Coldwater Springs purchase.

“We are looking to expand even more with additional acquisitions slated to close in the next month,” Brotherton said.

The company is looking to buy both older and newer properties, preferably in in-fill locations.

Bascom ranks as the country’s 47th-largest apartment owner, with about 25,500 units in its portfolio, according to the latest ranking by trade publication Multifamily Executive. It’s the third-largest OC-based apartment owner, based on unit count, according to the publication’s 2012 rankings.

Newport Beach-based Irvine Company ranks No. 28 with about 44,500 units, while Irvine-based affordable housing investor WNC & Associates is No. 16, with more than 51,000 units.

Englewood Office

Newport Beach-based KBS Realty Advisors has paid a reported $54 million for a 10-story office building outside Denver.

The company said this month it bought the Peakview Tower, a 264,149-square-foot building in Englewood, about 10 miles south of downtown Denver.

The sale works out to a price of about $204 per square foot. Fort Worth, Texas-based Crescent Real Estate Equities was the seller, according to a CoStar Group Inc. report.

Tenants at the 11-year-old building include JP Morgan Chase, Bank of America and United Healthcare. The office is about 92% leased.

KBS has been best-known of late for big-dollar investments it has made for five non-traded REITs that it manages, but the Peakview Tower purchase was made on behalf of a separate account investor, according to the company.

KBS-affiliated companies now own more than 1.3 million square feet in the Denver area.

Steadfast Buy

An investment offshoot of Irvine-based Steadfast Cos. has picked up an apartment complex in Louisville, Ky.

The company’s Steadfast Income REIT Inc. paid $15.1 million for the Valley Farms Apartments, a 160-unit garden-style apartment community in Louisville. The price works out to about $94,000 per apartment for the complex.

It’s the fourth Louisville investment for the company, said Rodney Emery, chief executive of the non-traded real estate investment trust.

The Steadfast REIT now has invested over $260 million in 16 apartment complexes in seven Midwestern and Southern states. Those complexes total about 3,500 apartment units, and 3.4 million square feet of residential space.

The REIT has raised about $147 million from investors since launching in the summer of 2010.

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Mark Mueller
Mark Mueller
Mark is the Editor-in-Chief of the Orange County Business Journal, one of the premier regional business newspapers in the country. He’s the fifth person to hold the editor’s position in the paper’s long history. He oversees a staff of about 15 people. The OCBJ is considered a must-read for area business executives. The print edition of the paper is the primary source of local news for most of the Business Journal’s subscribers, which includes most of OC’s major corporate and community players. Mark’s been with the paper since 2005, and long served as the real estate reporter for the paper, breaking hundreds of commercial and residential real estate stories. He took on the editor’s position in 2018.
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