Orange County Business Journal

Big Sale in Little Saigon: Apartments Fetch $43.5M

REAL ESTATE: HSBC sells to local buyers for $302K per unit Mark Mueller Sunday, July 14, 2013
Jasmine Place: 144 units, nearly full

Jasmine Place: 144 units, nearly full

The largest residential real estate project to be built in Little Saigon in more than a decade has traded hands for $43.5 million.

The 144-unit Jasmine Place apartment complex in Westminster was sold to a local family business known as Golden Horizon Realty, according to brokers with the Newport Beach office of CBRE Group Inc. who worked on the deal.

The four-story property, which runs about 156,000 square feet, traded hands for approximately $302,000 per apartment and about $279 per square foot.

The 4-year-old property, initially envisioned as for-sale housing, sold at around 75% of its peak-level valuation.

State records show its new owners are based in Newport Beach. Golden Horizon and its affiliates are said to have “substantial” real estate holdings in the area, including malls and self-storage facilities.

The property attracted a heavy amount of interest from local and institutional apartment investors, thanks to the strong local rental market, as well as a limited amount of high-end properties on the market in Orange County, said CBRE Senior Vice President Ray Eldridge, who worked on the sale with colleagues Michelle Jefcoat and Kevin Mulhern.

“Right now it’s a very thinly traded market, on the investment side,” Eldridge said.

The sale adds another chapter to the short history of Jasmine Place, which is just off Bolsa Avenue at Moran Street, next to Asian Garden Mall.

Frank Jao

The 150,000-square-foot mall, owned by Frank Jao’s Bridgecreek Development, is described as the largest majority Vietnamese-owned and operated mall in America. The two-story mall has more than 300 shops and restaurants and is believed to be Orange County’s largest jewelry center.

Jao, the largest real estate developer in

Little Saigon—which covers parts of Garden Grove, Westminster and several other OC cities—also led the initial development of Jasmine Place.

The project’s Asian- and French-inspired designs cater to the local Vietnamese community—the largest concentration of Vietnamese-Americans in the country.

The complex, previously called Saigon Villas, was initially conceived as a senior-housing condominium project.

It was reported to have an estimated value of more than $57 million around the time of its opening in 2009, but the development found few buyers amid the ongoing real estate downturn.

Conversion

Only eight units had sold by late 2010, when Jao got city approval to convert the project to condos without tenant-age restrictions.

Jao told city officials at the time that the project was struggling due to the inability of seniors to get mortgage loans. The developer reported that the price cuts of 40% had not helped spark additional sales.

The change to nonsenior housing wasn’t enough to keep the project out of financial troubles; by 2011 the development had been placed in receivership and was converted to an upscale rental complex.

The property, whose units average nearly 1,100 square feet, is now nearly 100% occupied, according to Eldridge, who sold the property on behalf of its lender, London-based HSBC Holdings PLC.

The new owners could consider converting the apartment complex back to a for-sale project in the future, he said.