Apartment investor The Bascom Group LLC last month acquired a 360-unit complex in Aurora, Colo., for $74 million, or about $206,000 per unit.
Bascom, based in Irvine, bought the Hearthstone at City Center, along with an affiliate of San Francisco-based investment manager Oberndorf Real Estate Management LP.
The seller was Philadelphia-based real estate investment trust Independence Realty Trust Inc. (NYSE: IRT), which inherited Hearthstone in 2021 following a merger with Steadfast Apartment REIT.
Steadfast Apartment REIT, which was born out of Irvine-based investment firm Steadfast Co. in 2013, bought the property in 2015 for $53 million.
The 41-building apartment community, which spans 18.3 acres, marks Bascom’s 37th Colorado acquisition and its 10th buy in the city of Aurora. The complex is about 5 miles east, and a 20-minute drive, from downtown Denver.
The company “has a long history of owning and operating in the city of Aurora and the state of Colorado,” Bascom Senior VP and Principal of Acquisitions Jim Singleton told the Business Journal.
Bascom to date has invested $1.5 billion in Colorado; its portfolio in the state currently stands at over 12,000 units.
On a national level, Bascom has completed over $22 billion in multifamily transactions, totaling 105,000 units.
Bullish on Area
Both Bascom and Oberndorf “like Colorado overall given its moderate regulatory and business-friendly environment,” Oberndorf Managing Director Peter Oberndorf told the Business Journal.
The greater Denver area, however, has recently seen a softening in rent due to a bout of new apartment product, officials said.
Both companies remain bullish on the region, since “new supply [will become] harder to build given the high interest rate environment and recent development restrictions, which will stagnate supply for the foreseeable future,” Oberndorf said in a statement.
The partnership, the third multifamily deal between the two firms, aims to improve the operations and interiors of the apartment complex, which was constructed in 1984, to “make Hearthstone a top choice among multifamily product in the immediate area,” Senior VP of Portfolio Operations Paul Zahkary said in a statement.
Improvements to individual apartment homes include upgraded appliances, countertops, lighting, additional in-unit washers and dryers, added kitchen backsplashes, new cabinets, fixtures, and wood plank flooring. The Bascom-Oberndorf partnership also plans to upgrade Hearthstone’s common areas, such as its fitness center, leasing office and pool.
The complex offers proximity to Aurora City Place shopping center, which is a midway point between downtown Denver and Denver International Airport.
New Mexico Firsts
Hearthstone is Bascom’s fourth acquisition this year.
Bascom’s other acquisitions this year include Texan 26, a 204-bed student housing community in Austin; The Overlook, a 344-unit apartment complex in Albuquerque and San Miguel Court, a 96-unit multifamily property in Santa Fe, N.M.
The two New Mexico deals were the company’s first in the state.
