NOVATO, CA-Davlyn Investments of San Diego has made its first foray into Northern California with the $16 million acquisition of an 88-unit complex called the Oak Grove Apartments, according to Davlyn’s director of acquisitions, Aaron Pacillio. Pacillio tells GlobeSt.com that the San Diego -based investment firm plans to rename the complex Crooked Oak at Loma Verde Preserve.

Pacillio says that the property, at 130 Cielo Lane, is a core-plus investment and was constructed in 2000. He notes that the complex is in Marin County, where per capita incomes are some of the highest in the nation. The seller’s agent was Brad Pennington of Marcus & Millichap. Lending was provided by Eric Flyckt with NorthMarq Capital.

Pacillio commented regarding the investment that, “We’ve been actively seeking deals in the Bay Area since 2005, with no success. However, the recession has allowed us to finally pick up one of the few Northern California multifamily assets built within the last 10 years, at a price that we could get our arms around.” He added that despite the recent vintage of the asset, "Our market research indicates there is a viable value-add component associated with select interior and exterior upgrades.”

Paul Kerr, president of Davlyn, describes Marin County as "one of the most supply-constrained markets in the Bay Area," and he points out that approximately 84% of the county consists of protected open space preserves. "This lack of buildable land, coupled with onerous building regulations and fee structures, contributes to the county’s perpetual housing shortage," Kerr says. Consequently even with one of the worst job markets in history, occupancy rates continue to stay in the 90% range, he adds. These factors, Kerr says, "should lead to above-average rental growth during our holding period.”

Davlyn, an owner-operator of apartments, condominium conversion projects and office buildings throughout California, has acquired in excess of $775 million in real estate assets. The company is headed by Jon Williams and Paul Kerr.