Sunnyvale, Calif.—The rent keeps increasing in Sunnyvale, Calif., and that’s good news for Calvera Partners LLC. The private real estate investment firm based in San Francisco announced that it has purchased a 42-unit garden-style apartment building, which will be renamed Maude Gardens, in Sunnyvale, Calif. According to RealFacts, the year-over-year rent growth in the area was 17.6 percent, with a vacancy rate of 2.3 percent.
“Because of the rapid growth in Silicon Valley, we’ve been able to find attractive investment opportunities where in-place rents are significantly below currently achievable market rents,” Brian Milovich, managing principal, Calvera Partners, tells MHN.
The apartment building includes 40 one-bedroom, one-bathroom units; one one-bedroom, one-bathroom plus den unit; and one studio. The property features a swimming pool and abundant parking.
Calvera also plans to make improvements to some apartments once the acquisition is complete. “In certain units we will be installing hardwood floors, new appliances, and updated kitchen countertops,” Milovich says.
Deutsche Bank Berkshire Mortgage provided debt financing for Maude Gardens which originated a seven-year loan from Fannie Mae.
Because of the strong environment, Calvera has high hopes for generating revenue this coming year, although they know rents won’t continue rising forever.
“We expect rents to continue to grow throughout Silicon Valley because of the lack of new supply coupled with improving employment prospects for the region,” Milovich says. “We don’t, however, believe that the double-digit growth experienced over the past 12-18 months is sustainable and that the area will revert to historical growth trends.”