MG Properties Group Likes Value-Add Apartment Buy

By Natalie Dolce

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Barham Villas Apartments

SAN MARCOS, CA-MG Properties Group, a private San Diego-based real estate investor and operator, has acquired of Barham Villas Apartments, a 168-unit multifamily property here. The property was acquired for $28 million from New York City-based TGM Associates LP.

Mark Gleiberman, president of MGPG, called Barham Villas, “an exceptional opportunity,” and points out that it allowed them “to add value through both asset and operational improvements while benefitting from the extremely strong market fundamentals in San Marcos.”

MG Properties Group represented itself in the negotiations. Kevin Mulhern, Ray Eldridge, Dixie Hall and Rachel Hemingway of the CBRE San Diego multi-housing group represented the seller.

Barham Villas is located in the university district of San Marcos. “This location will benefit from the continued expansion of CSUSM, Barham Drive access to the new Palomar Hospital, and easy access on the Sprinter commuter rail, 78 freeway and Twin Oaks Valley Road to major North County and I-15 corridor job bases,” explains Lane Jorgensen, managing of MGPG investments.

Originally built in 1987-88, Barham Villas underwent a significant renovation in 2008 that included $1.2 million in upgrades, including completely remodeled kitchens and baths, as well as new carpet, paint, light fixtures and appliances. Approximately 48 of the 168 apartment homes feature full-size stacked washers and dryers in the outside storage closets.

The acquisition was financed with a $21.36-million fixed-rate loan from Freddie Mac arranged by Andrew Behrens at CB Richard Ellis capital markets. The property offers a mix of one-, two-, and three-bedroom apartments. Each apartment has a large one-car garage. The kitchens and baths were remodeled by the previous owner.

MGPG plans to complete additional interior upgrades, renovate the common areas to contemporary standards and remedy deferred maintenance issues to improve resident quality of life. Jorgensen says in a prepared statement that “Of the many great markets in San Diego County in which to invest in apartments, no other has received as much major new public investment as this pocket of North County has in the last few years, investment that is enhancing the local private sector employment outlook. This location is central to medical, higher education, technology and R&D economic drivers that will create demand for housing across the price spectrum."

Since December of 2010, the firm has participated in nine apartment transactions on the West Coast encompassing 2,081 units at a total value of $267 million. Six of the deals were acquisitions totaling 1,526 units at a value of $188 million.

MGPG anticipates closing an additional $200 million in acquisitions within the next 12 months.

Categories: West, Multifamily, Acquisitions/Dispositions, San Francisco