[IMGCAP(2)]In the Arbors at Warner Center deal, a joint venture of San Francisco-based Swig Co. LLC and an institutional real estate investment fund managed by Capmark Investments LP acquired the property in a direct deal between buyer and seller. Mitch Thurston and Andy Ahlers of Capmark Finance Inc.'s San Francisco office originated a new first mortgage for the acquisition through Freddie Mac's CME multifamily loan program. Investors Property Services of Foothill Ranch in Orange County will handle the day-to-day property management of the Arbors.

According to Ken Perry, the Swig Co.'s chief investment officer, the acqusition enabled the San Francisco-based firm to "acquire a good institutional-quality residential community at a basis that should minimize our downside exposure and allow for great cash flow and potential upside as the economy and the local market recover." Perry adds that, "This one-off investment in a multifamily residential property is clearly a departure from our business plan goal of acquiring additional urban office buildings." However, he said, the investment in the Arbors creates additional product-type and geographical diversity for the Swig Co. portfolio.

The Arbors represents the Swig Co.'s second major real estate holding in Southern California along with the Arco Center office complex in Long Beach. The Swig Co. and Capmark are also partners in the $200 million Kaiser Center project located on Lake Merritt in Downtown Oakland.