BY: KELSI MAREE BORLAND
LOS ANGELES—Advanced Real Estate Services out bids dozens of investors to win the Olivewood Apartment complex in the growing South Los Angeles market. The property will be rebranded as the 5800 Apartment Homes.
The property will be rebranded as the 5800 Apartment Homes
LOS ANGELES—Irvine-based Advanced Real Estate Services has acquired Olivewood Apartments, a 149-unit apartment complex in Lakewood, CA. The property is located in a secondary Los Angeles market that has seen ample growth recently, and as a result, the sale attracted dozens of buyers. ARES won the asset for $31 million, or $207,335 per unit, from Interstate Equities Corp.
“Lakewood has experienced 9% rent growth in the past 12 months, while occupancy there exceeds 98%,” Dean Zander, senior managing director at Berkadia, tells GlobeSt.com. “All the interested investors were planning a moderate to extensive upgrade and/or reposition program to take advantage of the desirability of the location. ARES is well regarded as one of the most ambitious and experienced apartment renovation experts in the market, and they were excited by tremendous upside play.” Zander represented the seller in the transaction.
Interstate Equities completed its seven-year business plan for the property, and decided to liquidate, according to Zander. He received tremendous interest from private capital investors, family offices and sponsored operators, which all saw the upside potential due to the recent growth in the market. “Lakewood is a market with infrequent apartment trades, very strong fundamentals and terrific employment. Lakewood is one of the leading markets in the South Los Angeles area, which saw 5% rent growth last year, with average rents at $1,838, and vacancy rates of 3.9%.
ARES plans to renovate and reposition the circa 1976 property to the tune of $6 million, and rebrand it as The 5800 Apartment Homes. The 149 units are a mix of one- and two-bedroom units. On site amenities include a pool and spa, a fitness center, two laundry facilities, a courtyard, picnic areas with barbecue grills. The property has onsite parking and gated entry. The investor raised $21 million in equity for the purchase and secured a $16 million loan for the remainder of the acquisition and the renovation plan.