MARINA DEL REY, CA-Denver-based UDR Inc. has closed on its purchase of Marina Pointe, a four-story, 583-unit multifamily community that was built in 1993 for $157.5 million. In contrast to many of the properties in Marina del Rey, Marina Pointe is not on a ground lease. 

Brett Betzler, a broker in Moran & Co.’s California office, and Mary Ann King, president of Moran & Co., represented the seller in the transaction. Although Betzler could not disclose the identity of the seller except to say that it is “an institutional owner,” an unidentified source tells GlobeSt.com that the seller was a JV between BlackRock Realty and CalPERS. GlobeSt.com also learns that the prior sale of the property was in 2002 for $117.2 million.

Betzler tells GlobeSt.com that the property, located at 13603 Marina Pointe Dr., is “in a great location and gets great visibility,” which he says was one of the attractions for UDR, who owns two other properties in the area. He adds that the property is walking distance from the marina and across the street from a huge retail center with a Gelsons, Vons, and a number of restaurants.

Betzler points out that “the buyer assumed $67.7 million in variable-rate tax exempt bond financing, which had an interest rate of only 1.20% at the time of sale.” He adds that “This outstanding financing, along with a clear value-add opportunity evidenced by $180 rent premiums on over 100 units the seller had already renovated, significantly enhanced the value of the asset”

Many properties in Marina del Rey are on a ground lease, but Betzler tells GlobeSt.com that this one is not. “It’s better,” he says. “A ground lease isn’t necessarily a bad thing, but it depends on how it is written.” As for reasons for selling, although Betzler couldn’t really disclose specifics, he says that “the seller sold because cap rates have come down and this is the best environment we have seen in at least two years.”

King says that “With the sale of Marina Pointe, Moran & Co. has now completed 10 institutional sales in the Marina del Rey area, comprising over 3,700 units, and totaling $854 million since the year 2000.”

Average unit size at Marina Pointe is 853 square feet. The purchase is part of the multifamily REIT’s previously reported acquisition of five operating communities as well as one pre-sale venture for $455.1 million. 

In addition for Marina Pointe, the communities include: 1818 Platinum Triangle in Anaheim, CA for $70 million; Garrison Square in Boston for $98 million; Ridge at Blue Hills in Braintree, MA for $40 million; Domain Brewers Hill in Baltimore; and the pre-sale venture is Lodge at Stoughton in Stoughton, MA for $43.1 million. The pre-sale venture was with an affiliate of the Hanover Co. to develop a 240-home community built to the same quality and amenity specifications as other recently acquired Hanover communities. Lodge at Stoughton will be well located and served by the “T” commuter rail station located 3.4 miles to the southwest and will feature immediate highway access to Route 24, the second largest industrial arterial serving the Boston area, according to a prepared statement.