A Phoenix-based apartment investor has paid a reported $24.1 million for a four-building business park in Laguna Niguel that was recently entitled for a multifamily project.
Alliance Residential Co. recently closed on the purchase of the business park, a mixture of 1970s-era office and industrial buildings along Forbes Road near Crown Valley Parkway.
The buildings, just west of the Santa Ana (I-5) Freeway, total about 93,000 square feet and were about two-thirds leased at the time of the sale, according to brokerage data.
The combined properties, which are on 5.1 acres, sold for about $4.7 million per acre, according to CoStar Group Inc. records.
The deal is one of the larger local transactions of late involving property that’s expected to have apartment development.
The site’s former owner, an affiliate of Newport Beach-based Blackwood Real Estate, last year got city approval to redevelop the site into a 351-unit luxury apartment complex tentatively called Gateway Village.
The project is expected to hold one- to three-bedroom units as large as 1,500 square feet, and in buildings that could be as tall as six stories.
The site is also expected to hold a five-story parking structure and about 6,000 square feet of retail space, along with other amenities such as a pool, spa and fitness rooms.
It took nearly two years to get the site entitled for residential development, according to officials with Blackwood.
Alliance Residential, which has an office in Newport Beach, is expected to break ground on the project in the fourth quarter.
“We are pleased that Alliance is on board to take this project to the next level,” Blackwood partner Gilad Ganish said.
Alliance manages more than 11,000 apartment units in Southern California, and is said to have nearly 2,000 apartments in the region either under construction or just built.
The Laguna Niguel property is the only development site in Orange County that privately held Alliance Residential is known to own.
The company also is part owner of an existing apartment complex in Laguna Woods, the 134-unit San Sebastian, a senior housing complex.
It also manages Astoria, the two-tower residential rental component of the Central Park West development in Irvine, near John Wayne Airport.
Astoria, originally built as a for-sale project, was converted to apartments a couple years ago. It was acquired late last year for about $144 million by a unit of the Florida-based State Board of Administration, which invests on behalf of several retirement, pension and investment funds in that state.
Gateway Growth
Blackwood officials said they’re looking at bringing new development projects to the area as Laguna Niguel seeks to “realize its vision of an urban community in the area.”
Gateway Village is one of several former commercial sites in the same part of
Laguna Niguel that is being converted to apartments.
As of February, there were nearly 1,200 apartments either under construction, recently entitled or in the planning process for the city’s “Gateway Area” near the intersection of the San Diego (I-5) Freeway and Crown Valley Parkway.
Other apartment developers working in the area include Dallas-based Mill Creek Residential, United American Properties of Newport Beach and San Juan Capistrano-based Picerne Group.
Other recent development projects in the area include a 127,000-square-foot Life Time Fitness gym, which is scheduled to open this week at the former site of a Home Depot Expo center that closed in 2009.
