ORO VALLEY, AZ-Relying on its reputation and familiarity with a broker, HSL Properties managed to beat out competition to acquire the 330-unit Sundown Valley Apartments from JIK Properties. The Tucson-based buyer paid $18.5 million for the class B multifamily property, which was built in two phases between 1984 and 1994.

"It was our understanding that, in discussing this deal with our counterparts, that they were disappointed not to win it," says Omar Mireles, HSL Properties' executive vice president, commenting on the acquisition of the property at 8215 N. Oracle Rd. He tells GlobeSt.com that putting forward HSL's record in buying and owning properties in the Tucson area helped give it the edge. Also, having done deals with the seller's broker, Art Wadlund with Hendricks & Partners, was also a great help. "Art knows us well; we've done a lot of deals with him during the past 15 years," Mireles comments. "He understands that, when we make an offer, we deliver as promised on the terms, and we hope that speaks for itself."

The multifamily asset itself is somewhat different from HSL's typical acquisitions, as it's somewhat older. However, Mireles says it's very well-located and there was a good opportunity to improve operations. HSL also plans to invest $2 million to upgrade the property by adding new windows, balconies and roofing, as well as providing an exterior face lift.  "We'll also address the amenities, such as the gym and pool and upgrade some of the interiors as we go through it," Mireles says.

The occupancy at the time of sale was 93%. Sundown Village is situated on 15 acres and offers one-, two- and three-bedroom units, including single-story casitas. Renovations will begin this month.

HSL Properties is still seeking out existing multifamily properties in Phoenix and product as well as potential sites for building in Tucson. "We think there's still room for additional luxury units in Tucson, but we're being very selective in where we develop," Mireles explains. HSL began construction on the 272-unit Encantada at Dove Mountain in Marana, AZ last August at an approximate cost of $29 million and will soon commence construction in the 288-unit Encantada at Steam Pump Ranch, which will cost approximately $30 million.