Storm Properties Acquires Phoenix-Area Community
The previous owner invested $1.8 million in property upgrades.
Vancouver-based Western Wealth Capital has sold The Arches, a 200-unit multifamily community in the Phoenix suburb of Glendale, Ariz.
A Northmarq team brokered the $33.5 million transaction on behalf of the seller and arranged a five-year, fixed rate $23.5 million Fannie Mae acquisition loan for the buyer, California-based Storm Properties.
According to Yardi Matrix, the asset last traded in 2019 for $23.1 million. The same source reveals that the property is subject to a $16.5 million Citibank loan, which carries a 2026 maturity date and was originated by the same broker at the time of the previous acquisition.
The Arches came online in 1985, on a 6.8-acre site and encompasses one- and two-bedroom units—ranging from 616 to 901 square feet—across 13 two- and three-story buildings. According to the same data provider, residents have access to a variety of amenities, including a clubhouse, a spa, two pools, as well as laundry facilities and 300 parking spaces.
Western Wealth invested $1.8 million in interior and exterior upgrades, deferred maintenance and amenity renovations at the property. The former owner reconditioned 64 percent of the units through the addition of new flooring, paint, stainless steel appliances, tile backsplash and new light fixtures. In a prepared statement, Northmarq President Trevor Koskovich emphasized the value-add opportunity for the new owner to renovate the remainder 73 units.
Located at 6240 N. 63rd Ave., The Arches is less than 2 miles from downtown Glendale and some 7 miles from Glendale Airport Hangars. The property is surrounded by an array of retail, dining and entertainment options. Harold W Smith Elementary School is also close to the community.
The Northmarq team that brokered the transaction on behalf of the seller was led by Koskovich, Jesse Hudson, Ryan Boyle and Logan Baca, while Brandon Harrington, Christopher Gitibin, Tyler Woodard, Bryan Mummaw and Bryan Liu secured financing for the buyer.
A market poised for growth
According to a Northmarq 2022 third quarter Phoenix multifamily report, the market had an overall vacancy rate of 5.8 percent and rents were up 7.1 percent year-over-year. While the median price in the third quarter was roughly $274,000 per unit, The Arches traded well below, at $167,500 per unit.
Although recent metrics point to a shift in the market’s direction over the last few quarters, the current situation is still consistent with the long-term supply and demand balance in the region.
Located in the South Glendale submarket, The Arches is exposed to sustained economic and job growth, with more than 55,000 businesses that have approximately 60,000 job offerings within a 10-mile radius of the community.
And despite a cooling property performance, multifamily investors continue to show a strong interest in the market. In November, joint venture partners Avanti Residential and FCP acquired Omnia on Thomas, a 382-unit apartment community in Phoenix. Five Doors Plus also invested in the city with the acquisition of Montecito, a 92-unit multifamily community. Another significant sale in the area was Tides Equities’ acquisition of a three-property portfolio near Phoenix, totaling 466 units.