Palo Alto-based Pacific Properties Co. continued its move into Orange County’s apartment market by acquiring the 104-unit Rancho Palisades Apartments in Costa Mesa for $9.9 million.
Pacific plans to invest an additional $1.3 million to upgrade the property and rename the Spanish-style apartment complex Missions at Back Bay.
Pinnacle Realty is set to manage the property for Pacific.
The acquisition, Pacific’s fourth in OC in recent years, brings its total units in the county to nearly 1,000 and its West Coast total to 4,036.
Privately held Pacific plans to increase its market share in OC further.
“We intend to invest $50 million in Orange County in the next nine months,” said Phillip Shuster, managing director of Pacific’s Southern California operations.
Other Pacific properties in OC include the 406-unit Villas at Tustin in Santa Ana, the 272-unit Slate Creek in La Habra and the 184-unit Brookstone in Buena Park. Pacific owns another 1,000 units in Los Angeles County.
Shuster said Pacific’s rehab investments depend on the condition of the property and the demographic of the neighborhood.
“We have bought property where people were paying the same they were paying 10 years ago. We’ve seen other property where rents were way below market,” Shuster said. “Landlords were inattentive in some cases, but we have found that people are willing to pay more for rents if they’re getting something for it.”
“Due to the excellent condition of the property, our capital improvement efforts will be focused on enhancing the existing architectural features and layout of the property,” said Rich Marquis, Southern California portfolio manager for Pacific.
Improvements will include changes to the landscaping and curb appeal of the apartment complex near the Back Bay, he said.
John Thomas of Providence Realty Group represented Pacific Property in the deal, while Randall Lee of Lily Enterprises represented the seller, Rancho Palisades LLC. n
