GLENDALE, AZ-An investor from Hacienda Heights, CA, has made hissecond investment in the market, buying Sagewood Apartments for$7.9 million.

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The buyer, doing business as H.M.G. Properties LLC, acquired the176-unit, class B community from a joint venture comprised ofSendera Investment Group of Austin, TX, and AEW Capital Managementof Boston, MA. The JV acquired Sagewood Apartments in 2005 for $9.4million.

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H.M.G. Properties beat out 15 other investors to take possessionof Sagewood Apartments, which is located in the northwest submarketat 15082 N. 59th Ave. “This was a fairly sought after propertybecause of location,” notes Alon Shnitzer, a vice president ofinvestments with Marcus & Millichap’s Phoenix office. “At thetime it went into escrow, there weren’t many B properties availablein the Phoenix markets. If you were looking in that niche, Sagewoodwas pretty much the only complex on the market.”

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Shnitzer represented H.M.G. Properties in the transaction. SeanCunningham of CB Richard Ellis’ Phoenix Office represented theseller.

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Shnitzer says the buyer was attracted to the complex because itis close to his other property, the 180-unit Rosewood Apartments.He bought that property in 2005 for roughly $43,000 per unit.

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“We’ve been looking for about three years for another property,and we finally found the right deal,” Shnitzer tells GlobeSt. “Thebuyer has a huge comfort level with Sagewood Apartments because heowns its sister property, Rosewood. The two properties will createeconomies of scale for him, plus he bought Sagewood at a similarprice point as what he paid for Rosewood in 2005.”

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Built in 1984, Sagewood offers a mix of one and two-bedroomunits. Its occupancy rate is in the mid-80% range. “The buyerexpects to realize some upside from both increased occupancy andrental rates when the market returns,” Shnitzer explains, addingthat Phoenix-based Consolidated Asset Management will handle theleasing and management of the property.

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H.M.G. Properties obtained a fixed-rate, 70% LTV loan from theMutual of Omaha Bank to acquire the property. Luke Donahue inNorthmarq Capital’s Phoenix office arranged the financing .

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