TODAY’S DEALS: IPA Arranges $76.5M Sacramento Area Sale

IPA completes the $76.5 million sale of a 612-unit property in Roseville, Calif.; NorthMarq Capital arranges two multifamily mortgages totaling $24.5 million; and Hendricks & Partners represents the seller in a 4.8 percent cap sale.

Slate Creek at Johnson Ranch

Roseville, Calif.—Institutional Property Advisors has negotiated the sale of Slate Creek at Johnson Ranch, a 612-unit multifamily community located in Roseville, Calif., for $76.5 million. The sales price represents $125,000 per unit and $120 per square foot. Stan Jones, Phil Saglimbeni and Sal Saglimbeni represented the seller, Prime Real Estate, with additional input coming from Ken Blomsterber at Marcus & Millichap Real Estate Investment Services, an affiliated firm. The property was bought by a private investment group.

“Slate Creek combines a very unique setting, favorable resident profile and a compelling value-add story,” says Jones. “The local market conditions in the Roseville/Rocklin submarket are continuing to strengthen, as evidenced by low vacancy rates and measurable market-rent growth over the past year.”

The 638,040 square-foot community, located at 1751 East Roseville Parkway, is adjacent to a grocery-anchored shopping center. Slate Creek at Johnson Ranch was built in 1989 and is comprised of two- and three-story wood-frame buildings spread out over 43 acres.

“The asset was well received by the investment community and was acquired subject to the assumption of a favorable agency loan,” says Phil Saglimbeni. “The escrow closed in fewer than 30 days from the execution of the purchase contract.”

NorthMarq arranges $24.5M in mortgages on two properties

Concord, N.C. and Oklahoma City, Okla.—NorthMarq Capital has arranged two multifamily mortgages totaling $24.5 million. The Charlotte Regional office arranged first mortgage financing in the amount of $14 million for Cloister of Concord, a 360-unit property located in Concord, N.C. The financing was based on a 10-year term and a 30-year amortization schedule. Freddie Mac will provide the funding to the seller.

NorthMarq’s San Francisco regional office also arranged first mortgage financing in the amount of $10.5 million for Quail Landing Apartments, a 216-unit community located in Oklahoma City. Financing was based on a 5-year term and a 30-year amortization schedule, and was also provided through Freddie Mac.

Hendricks & Partners represents seller in 4.8% cap sale

Anaheim, Calif.–Hendricks & Partners brokered the sale of Mariposa Apartments, located at 175-225 South Rio Vista in Anaheim, Calif. The 286-unit apartment community was sold for $43,000,000, at a 4.8 percent cap rate on in-place income.

The seller was Kennedy Wilson of Beverly Hills, Calif., and the buyer was Cadigan Mariposa LLC of Tustin, Calif. Ten-year, fixed-rate financing was provided by Deutsche Bank.

The off-market transaction was negotiated by Robin D. Ossenbeck, partner of the West Los Angeles office of Hendricks & Partners, and Shane Shafer, senior investment advisor of the Newport Beach office of Hendricks & Partners, on behalf of the seller.

Built in 1969, Mariposa features 174 one-bedroom and 112 two-bedroom apartments. Common-area amenities include swimming pools, fitness centers and recreation areas.

Ossenbeck says the sale of Mariposa is indicative of key trends occurring in the Southern California apartment marketplace, including declining cap rates and a rising volume of multifamily deals. “We expect to see more sales this year with lower caps than in 2009 to 2010,” she says, adding that the L.A. market is on track to close 2011 with more than $4 billion in sales volume, echoing the level last seen in 2005. Prior data shows L.A. apartment sales volume peaking at more than $6 billion in 2007 before declining to $1 billion annually in 2008 and 2009, with an uptick to $1.6 billion in 2010. In the first two months of 2011, sales volume totaled $447 million. While this data reflects Class A, B and C quality assets within Los Angeles County, it is indicative of the Southern California market as a whole, says Ossenbeck.

These trends are occurring thanks to “the lack of multifamily product to purchase, declining interest rates from 2010, and investor demand with lots of capital chasing deals,” Ossenbeck says, adding that Orange County in particular has few, if any, properties on market the size of Mariposa.

Additionally, the transaction represented a strong opportunity for the buyer, Ossenbeck says, noting that “rental concessions have diminished and rental rates are expected to increase soon.”

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