Irvine Co. has sold its only known commercial holding in Placentia and one of the largest apartment complexes in the city in what’s apparently Orange County’s biggest rental property sale of the year to date.
A unit of Fairfield Residential, a San Diego-based apartment owner and developer with a national portfolio of about 47,000 units, closed last month on the buy of Placentia Place, a 416-unit rental complex near the intersection of East Orangethorpe Avenue and Jefferson Street.
The nearly 30-year-old property sold for about $104.4 million, or $250,000 per unit, according to CoStar Group Inc. records.
It’s the only apartment sale in OC to top $100 million this year, according to CoStar’s data. The largest reported apartment sale in the area before that was Irvine-based Bascom Group LLC’s $94 million buy in March of the Villas at Tustin, a 406-unit complex in Santa Ana.
Placentia Place is on 13 acres about a mile north of the intersection of the Riverside (91) and Costa Mesa (55) freeways. It’s the second largest apartment complex in the city by unit count, trailing only the 422-unit Emerald Isle Senior Apartment Homes, according to CoStar records.
Units at Placentia Place, which also operated as Merrick Apartments in recent years, average about 850 square feet, and monthly rents start at around $1,500 for one-bedroom units.
The complex hadn’t been added to Fairfield’s website as of last week. The site lists three local apartment properties that the company owns, one each in Buena Park, La Habra and Tustin.
It’s also developing a 363-unit rental complex on Von Karman Avenue in Irvine called Rize. The podium-type development is scheduled to open this fall.
Fairfield got a $85.7 million loan from PNC Bank to finance its latest purchase, property records show.
3rd OC Sale
The deal represents the latest and largest area sale in a string of apartment transactions for OC’s largest owner of rental properties that began near the start of the year.
The Newport Beach-based investor and developer rarely sells commercial properties but has recently been offloading a number of older, noncore apartment properties it took over in 2013 as part of a portfolio deal of apartment properties formerly owned by Archstone Co. in OC and San Diego.
That deal—which came on undisclosed terms and totaled about 5,000 apartments—included rental properties in a number of local cities where Irvine Co. previously had no presence, including Aliso Viejo, Huntington Beach, Mission Viejo and Rancho Santa Margarita, as well as Placentia.
Since late last year, it has shed at least three of the OC properties, including the Placentia one. The two prior deals were in Santa Ana and Tustin, totaled about 342 units, and brought in about $96 million.
Sales in San Diego have also taken place, according to Irvine Co., whose California multifamily portfolio tops 58,000 units.
“While one of our principles is long-term ownership, we have, for strategic reasons, decided to sell (some) of those properties,” company executives said at the time of the first sales.
In addition to OC and San Diego properties, Irvine Co. owns multiple apartment complexes in Silicon Valley and Los Angeles.
Despite the recent sales, it remains on a rental growth push, thanks to an active development pipeline primarily in Irvine and Silicon Valley.
Real estate watchers familiar with Irvine Co.’s operations tell the Business Journal that the privately held company is angling for growth that would boost its portfolio closer to 75,000 units in the next five to 10 years.
