Eagle Partners JV Eyes $1.5B in West Coast Buys
The firms already purchased two communities in Southern California that anchor the joint venture.
Eagle Real Estate Partners, a Los Angeles-based institutional multifamily investment firm, has formed a strategic GP co-investment partnership with TriPost Capital Partners to support its ability to acquire up to $1.5 billion in multifamily assets across the West Coast and other select markets. TriPost, a multi-strategy real estate private equity firm, is committing more than $50 million in GP co-investment capital to the venture.
The joint venture is designed to accelerate EREP’s value-add and core-plus acquisition strategy, including acquiring fully regulated affordable housing, market rate-to-affordable conversions and workforce housing. The firm expects to deploy the capital across a pipeline of opportunities in the region.
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Shahny Lutfeali, managing partner and co-founder of Eagle Real Estate Partners, said in a prepared statement TriPost’s capital commitment will enable EREP to continue to execute its strategy across the West Coast and beyond. He did not specify other markets the group would target.
Anchoring the partnership
The partnership, along with other institutional capital partners, has made two transactions in recent months that serve as anchors for the new strategy. Last month, the investors acquired the Hendrix and Hadley Apartments, a 551-unit portfolio of age-restricted active adult communities in Escondido, Calif., for $162.5 million. The seller was MG Properties, according to Yardi Matrix.
Eagle led the public-private venture which also included Red Stone Equity Partners, JP Morgan and the California Statewide Communities Development Authority and Affordable Housing Access. JP Morgan issued a $104.4 million financing package consisting of two Fannie Mae loans, Yardi Matrix data shows.
EREP plans to convert the assets from market rate apartments to affordable housing and execute a capital improvement program. A minimum of 80 percent of the units, or about 440 apartments, will be restricted to households aged 55 and up, earning up to 80 percent of the area median income for the next 10 years.
The properties are located at 439 West El Norte Parkway and 1045 Morning View Drive, less than 1 mile from each other. The apartments at each site average approximately 754 square feet across studio, one- and two-bedroom layouts. Amenities include swimming pools, fitness centers, and a fenced dog park. Situated in a supply-constrained submarket about 34 miles northeast of downtown San Diego, the assets are near parks, retail outlets and healthcare centers.
In November, the venture alongside other institutional capital partners purchased The Hills at Hacienda Heights, a 350-unit multifamily community in Hacienda Heights in Los Angeles County, for $107 million, also from MG Properties. Other capital partners included Red Stone Equity Partners, JPMorgan Chase, California Housing Finance Agency and Affordable Housing Access.
Built in 1970, the property at 2401 S. Hacienda Blvd. is being reconfigured for households earning 80 percent of the area median income. While current residents who don’t meet the income restrictions will not be evicted, new renters will be required to meet them under the regulatory agreement for a long-term affordable property.
