BAKERSFIELD, CA-The $25 million sale of the 258-unit EdgewaterApartments here is the largest apartment sale in California'sCentral Valley in three years, according to broker Moran & Co.Mike Murphy of the Irvine office of Chicago-based Moran & Co.,who represented the seller along with Mary Ann King of Moran'sIrvine office, tells GlobeSt.com: “The property is in a fantasticlocation surrounded by over 5,000 of the best jobs in the region.Major employers within a five minute drive include Chevron, AeraEnergy, State Farm Insurance, Mercy Hospital, and California StateUniversity, Bakersfield. State Farm’s recent announcement of theconsolidation of their Rohnert Park and Fresno operations intotheir Bakersfield facility will only add more high-quality jobs tothe neighborhood.”
Golden State Financial, a private Fresno-based real estateinvestor, acquired the complex from Chicago’s Equity ResidentialREIT. Marc Thurston of Grubb & Ellis/ASU & Associatesrepresented the buyer.
Murphy observes that the Bakersfield rental market has historicallybeen stable, with average occupancy levels in the 95%-97% rangesince 2000, and though softening during this economic downturn, hasshown a remarkable resilience. “Our survey of the rental marketindicates that occupancy levels at comparable properties increased200-300 basis points in the last 12-18 months, nearly half of whichhas come in the last six months," Murphy reports.
King adds that investor interest in Edgewater was strong,ultimately attracting more than 20 offers. “Buyers were attractedby the opportunity for cash-on-cash yields superior to most otherCalifornia markets while still acquiring a high-quality asset in astrong rental market,” she said.
Murphy notes that Deanna Randall, president of Golden StateFinancial, when asked about the Edgewater purchase, responded thatit increases Golden State's presence in the Bakersfield market toown/operate over 1,000 multifamily units. "The timing was key dueto low financing rates and a subtle turnaround in the rental marketwhereby rent growth is beginning to reemerge,” Randall said.
The complex, located at 8200 Kroll Way, was built in 1984 and issituated on 15.1 acres along a man-made lake. The apartments are amix of one- and two-bedroom units ranging from 725 to 1,140 squarefeet with interior washers and dryers. Select units have fireplacesand vaulted ceilings.