BY DAVID PHILLIPS
TUSTIN, CA—Berkadia brokerage team has sold the property three times as the demand for high quality rental housing continues to grow here.
TUSTIN, CA—A new high-water mark has been set with the $163.55 million sale ofeaves by Avalon, a 628-unit apartment complex here. The asset is located in an affluent neighborhood bordering Irvine and Tustin Ranch, and Berkadia, which brokered the deal, notes that the price equals $260,000 per unit for the property. The firm says it is the largest price tag for a single asset market rate sale in Orange County for the past five years.
Built in phases starting in 1968, eaves Tustin totals 628 units in an affluent area bordering Irvine and Tustin Ranch.
“The property gathered a tremendous amount of interest from varying types of investors, all of whom were intrigued with the location, amenity space, acreage and repositioning potential, not to mention the excellent access to employment, shopping and entertainment centers nearby,” Berkadia senior director Dean Zander told GlobeSt exclusively. “Historically, institutionally-sized apartment communities in Orange County trade very infrequently, with the largest owners in the market controlling a huge majority of the housing stock in the area, and selling very rarely. (the buyer) recognized the significant scope and scale this asset would bring, and they were thrilled to add it to their portfolio totaling nearly 4,500 units throughout Northern and Southern CA.”
The buyer is Raintree Partners of Laguna Niguel. The Berkadia Southern California institutional brokerage team of Joe Leon and Dean Zander, and represented the seller, to whom they sold the building in 2010. This marked the third time in the past decade the team sold this community.
“Eaves Tustin is the epitome of a value-add opportunity,” Leon said. “With the planned interior upgrades the buyer will achieve a significant rent premium over the current rental rates, and still remain at rates below the newer competitive set nearby.”
Built in phases between 1968 and 1972, eaves Tustin is situated in an affluent neighborhood bordering Irvine and Tustin Ranch, where the median priced single-family home is above $1.2 Million. Property amenities include multiple pools and spas, two regulation tennis courts, a remodeled leasing office and fitness center, large clubhouse and more, situated on lots totaling over 26 acres. Apartment homes featured in-suite washer/dryers and many included a private garage or patio space.
“eaves by Avalon” is located at 13921 Tustin East Drive, just off Interstate 5 within close proximity to over 500,000 jobs in Orange County, in addition to being convenient to Disneyland, South Coast Plaza and John Wayne Airport.
Zander added “the immediate neighborhood is considered an affordable alternative to the Irvine market, and Tustin has enjoyed recent average market rent increases above 6% while still maintaining one of the lowest vacancy rates in Orange County at just 3.7%.” With high barriers to entry in the immediate area, the rents and occupancy rate are expected to increase further as the market struggles to meet the housing needs of an expanding population, he said.
As one of the largest real estate multifamily services firms in the country, Berkadia incorporates capital markets knowledge with local real estate expertise and deals with any type of multifamily transaction, regardless of size or complexity. Berkadia apartment advisors average more than 25 years of multifamily experience in each of their local markets and, in aggregate, have completed more than $80 billion in apartment transactions. Berkadia offers the services of more than 1,300 experienced industry professionals who operate from 75 offices in major and secondary markets throughout the country.