Irvine-based apartment investor Advanced Real Estate Services Inc. has made one of the largest local property buys of the year, for a 421-unit rental complex in Fullerton.
The privately held company, which also operates as ARES, last week said it closed on the purchase of Camden Parkside, a 21-building complex next to the Orange (57) Freeway.
The complex, at 2656 Associated Road, is a little less than a mile north of California State University-Fullerton and within walking distance of Brea Mall.
The property sold for close to $100 million, according to ARES, which would value the complex at a little more than $235,000 per unit.
There have been only two other Orange County apartment complexes to sell for more than $100 million this year—the 274-unit Elan in Huntington Beach and the 628-unit Eaves by Avalon in Tustin—according to CoStar Group Inc. records.
The seller was Houston-based Camden Property Trust, which acquired the complex in 2012 as part of a larger portfolio deal.
That 2012 deal valued the property at about $87 million, according to CoStar records.
The seller was represented in the latest deal by Michael Murphy with the Irvine office of apartment brokerage Moran & Co. The buyer represented itself.
ARES said it is rebranding the complex of two-story apartment buildings as Uptown Fullerton and will invest close to $25 million to upgrade the interior, exterior and common areas of the nearly 20-acre property, which was built in 1972.
The property has four pools, five spas, two fitness centers, a business center, two tennis courts, and a basketball and volleyball court.
Units run about 836 square feet and averaged monthly rents of $1,478 at the end of last year, according to Camden Property’s latest annual report.
The complex was 96% occupied at the end of the year, according to the sellers.
The buyers said they also plan to build another 40 units, which are already entitled, on the site.
ARES President Richard Julian said his company, within a few weeks, “raised over $55 million from our broad investor base of ‘friends & family’” to fund the deal.
“They recognize what a prime candidate this property is for our unique renovation capabilities and understand the terrific potential upside that can be achieved,” Julian said in a statement.
A $69.3 million Freddie Mac loan also was used to fund the deal. It was arranged by Mike Elmore with the Los Angeles office of Northmarq Financial. The initial interest rate on the loan was 2.9%, according to ARES, which owns and operates about 8,000 apartments in Southern California with a market value of more than $2 billion.
ARES funds its investments with private equity and handles all property management and renovation in-house.
The Fullerton buy is among the company’s largest purchases. It paid a reported $96 million in 2013 to buy a 714-unit complex in Corona.
ARES also has a high-end condo project under way in Corona del Mar and this year began building a small collection of semicustom homes near Cook’s Corner in Santiago Canyon.
