Irvine’s Bascom Group, a privately held real estate firm best known for investing in existing apartment properties across the country, is getting into multi-family development in Orange County.
The company said last week that it had entered into a venture with a new partner, Newport Beach-based Branch West Real Estate Partners LLC, to develop a mid-rise apartment complex in Orange, a third of a mile east of Anaheim’s Honda Center, home of the city’s hockey team.
The new venture, listed in state filings as BWV W. Katella LLC, said it closed on the purchase of the 1.1-acre site, at 1725 West Katella. Terms of the deal were not immediately disclosed.
Branch West initially invested in the site in January, paying about $4.2 million, property records show.
Brad Perozzi, a well-known figure in OC’s multifamily development scene, is the owner of Branch West and managing partner of the new venture with Bascom.
The development site next to Stadium Promenade shopping center has long held a nearly 20,000-square-foot office building. The offices will make way for a five-story, 94-unit multi-family building.
It’s one of the first new rental projects in Orange planned within walking distance of the Honda Center, an area seeing a heavy amount of investment in preparation for a large development push in the next few years led by the owners of the Anaheim Ducks, Henry and Susan Samueli.
The Samueli family has spent a figure approaching $200 million in recent years to buy land surrounding the city-owned Anaheim arena—which it manages through its Anaheim Arena Management LLC affiliate—with an eye on mixed-use development likely to include apartments, entertainment and other uses.
‘Anxious’ Area Watchers
A bulk of the Samueli family’s reported investments have been in Anaheim, not Orange, but the latter city could see its share of new development, officials with the just-announced BWV venture said.
“We are excited to work in the area, and really set ourselves apart from the other residential projects in the Platinum Triangle,” Perozzi told the Business Journal. “Having that walkability to retail and entertainment venues is ideal.”
“We are really anxious to see what [the Samuelis] will propose for the area, and we can only hope it will be the same high-caliber quality that is currently happening.”
Along with Branch West, Perozzi also serves as the head of Southern California operations for Intracorp Cos., a mixed-use developer with local offices in Newport Beach.
Prior to Intracorp, Perozzi worked for two other apartment developers with active operations in the area, the Picerne Group and Trammell Crow Residential.
Intracorp has a quartet of townhome projects in various stages of development in OC, including a trio of for-sale offerings in the Irvine Business Complex. It also has a 290-unit apartment development called Amplifi in the works for downtown Fullerton.
Intracorp isn’t involved in the Orange project, according to Perozzi, who describes the project with Bascom as being a smaller, more boutique deal than what Intracorp typically works on.
He said the total investment for the Orange rental apartment project will run in the $30 million range.
The project is slated to wrap in two years, Perozzi said, adding that it is targeted for “millennials with high-paying jobs in the area.”
Studios and one-bedroom units will average about 813 square feet. Two bedroom units top out at 1,210 square feet, according to city filings.
The target market will be well-educated young professionals and couples who want proximity to work in nearby job centers, social nightlife and services, according to the new venture.
Branch West has been working to get the Orange site entitled for apartments for about two years, according to city records.
The project’s expected to feature a courtyard with a spa and pool, fitness center, club room and roof deck to observe Disneyland fireworks.
Investment Partner
Bascom has a national apartment portfolio estimated at more than 18,000 units and often partners with other real estate firms for new commercial projects. It worked with Long Beach’s Harbor Associates to buy a string of offices in OC the past few years, among others.
It also backs Irvine’s Premier Business Centers, one of the area’s largest owners of executive suites.
Bascom’s involvement in multi-family development in OC has been rare in recent years, but it has done deals elsewhere in Southern California.
Last year, it announced a deal with another affiliated firm, Realm Real Estate LLC of Newport Beach, to buy a 1.7-acre site at the intersection of Seventh Street and Maple Avenue in downtown Los Angeles, paying just under $24.3 million.
They plan a 33-story, 452-unit high-rise apartment project called “7th & Maple,” expected to be one of the first residential towers in the Fashion District.
The Orange apartment project is being financed through a senior construction loan from Bank of the West, and the venture includes preferred equity from Marble Capital out of Houston, according to the developers.
Bellwether Enterprise’s Irvine-based capital team, led by Tom Kenny and Josh Boehling, secured the funding for the deal.
