Levin Johnston Directs $15M CA Sale
- May 14, 2018
Palo Alto, Calif.-based multifamily brokerage Levin Johnston has directed the $15 million sale of the Velocity at Sequoia Station apartment community in Redwood City, Calif. The 30-unit property is within walking distance of retail, restaurants and multiple public transportation hubs. Velocity at Sequoia Station is also near a number of household name employers, among them Google, Tesla and Apple.
Levin Johnston represented seller Old Adobe Management Company, as well as the buyer, a private owner and investor. During the time it owned the property, Old Adobe Management Company undertook a significant renovation and repositioning of the property, strengthening the asset’s value and increasing its competitiveness in an already tight market.
However, those enhancements also presented a hurdle for Levin Johnston. Due to “the fact the building had such high-end improvements, getting the buyer to pay a price in line with those improvements,” proved a challenge, Senior Managing Director Adam Levin told MHN.
“We were able to talk the buyer through it and explain to him that this core market will continue to appreciate in the long run . . . with solid rent growth projected for 2018 into 2019. We feel there are plenty of well-paying jobs in the immediate surrounding areas.”
Another potential issue proved less problematic.
“We didn’t get too much push back because of the interest rate level, because the interest rates had not increased [at that time] as much as they currently have,” Levin said.
Levin Johnston was able to help the buyer leverage current market momentum by acquiring Velocity at Sequoia Station as part of a 1031 exchange. “One of the most valuable services our firm provides is the ability to look at the big picture and support clients in making the right moves at the right time,” said Robert Johnston, Senior Vice President of Levin Johnston.
“In this case, we had a long-time client with two small properties in the region who was seeking an opportunity to expand his portfolio. We facilitated a smooth 1031 exchange for the buyer, ultimately meeting the needs of both the buyer and seller in this transaction.”
Exceptional Renter Fundamentals
Located at 1331 Jefferson Avenue in Redwood City, the community is situated in the heart of Silicon Valley, a region with what Johnston called exceptional renter fundamentals. “The region is home to a highly-educated and high-income earning population, providing an opportunity for strong long-term NOI for multifamily owners,” he added.
Levin Johnston supported the seller, a long-term client, in the acquisition of the property for $10 million in 2015. “Now, less than two years later, we were able to secure a strong price for the seller, while simultaneously helping the buyer to grow its portfolio and presence in the Bay Area,” Levin said.