Prime Residential Acquires California Communities in $275M Deal
- Aug 19, 2021
Prime Residential has purchased a pair of adjacent communities near the beach in Hermosa Beach, Calif. The company paid $162.5 million for Playa Pacific and $ 112.5 million for The Gallery. Institutional Property Advisors’ Kevin Green, Greg Harris and Joseph Grabiec represented the seller, Equity Residential, and also procured the buyer. According to Yardi Matrix data, Equity Residential acquired the two properties in 2006 for $133 million.
The two adjacent communities are located two blocks away from Hermosa Beach and are near many of the area’s employers that span a range of different industries including technology, entertainment, aerospace and defense companies.
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The 285-unit Playa Pacifica was built in 1972 and later partially renovated in 2015 and 2016. The community offers studio, one- and two-bed units that average 590 square feet and feature stainless steel appliances, quartz countertops and washers and dryers. The community’s amenities include a fitness center, business center, clubhouse, spa, outdoor lounge with a barbecue area and two pools. Playa Pacifica is 97.5 percent occupied, Yardi Matrix data shows.
Next to Playa Pacifica, The Gallery offers 169 units in studio, one- and two-bed floorplans that average 831 square feet. The community was built in 1971 and partially renovated in 2003 and 2004, now offering units that have granite countertops and walk-in closets. The Gallery also has a pool, fitness center, spa, sauna, gated entrance and covered parking. According to Yardi Matrix data, The Gallery is fully occupied.
Hermosa Beach appeal
Green, senior managing director at IPA, said in prepared remarks that the two communities represent 24 percent of the entire apartment stock in Hermosa Beach and 70 percent of the like-kind apartment stock in Hermosa Beach and Manhattan Beach.
Grabiec, also a senior managing director at IPA, added that there have been no institutional-sized multifamily properties built in Hermosa Beach in the last 50 years. He noted in his prepared statement that there was strong demand for apartment homes in the area due to more than half of the affluent Hermosa Beach population renting.
In January of last year, Grabiec also worked with Green and Harris to represent MWest Holdings in the $38.2 million sale of a 170-unit community in nearby Los Angeles.