COSTA MESA, CA—GlobeSt.com has learned exclusively that a joint venture between Red Oak Investments and CityView has closed on a 4.17-acre land parcel that will be the site of Baker Street Apartments. The project is a 240-unit luxury multifamily community on the southwest corner of Baker St. and Pullman Ave. here, which will begin construction in mid-2015.

Once completed, the project will be one of the first multifamily communities to be built in Costa Mesa in 10 years. Thomas P. Moran of Moran & Co.'s California office worked with Red Oak to identify a capital partner and close on the parcel.

According to Joe Flanagan, a principal with Red Oak, “We are delighted to be in partnership with CityView, a premier equity partner with deep experience in both the capital side and the development side. After working hand-in-hand with the city of Costa Mesa for two years to entitle the site, we are very excited to now focus our efforts on breaking ground and seeing this project through to completion.”

Fellow principal Alex Wong adds that Central Orange County is the job center of the region and it needs more rental options. “We are betting on the fundamentals. We are also betting that we can create a living experience and a neighborhood that is authentic, sustainable and distinguished from the homogeneous new projects that are being produced in neighboring areas.”

Regarding why so few multifamily communities have been built in Costa Mesa during the last 10 years, Wong tells GlobeSt.com, “Costa Mesa has strong elected leadership and an engaged, forward-thinking staff. On the west side, they put the visionary mixed-use urban plans in place 10 years ago, but the importance of preserving traffic neutrality in that neighborhood allowed the existing commercial uses to remain more valuable than new development. In the northern neighborhoods adjacent to South Coast Plaza, multiple projects did get entitled at high-rise densities, but the recession prevented all of them from developing.  On the east side, there just have not been available parcels. It feels as if we own the only one.”

The site is located within minutes of the Irvine Business Complex and South Coast Metro employment centers. It is also 1 mile from South Coast Plaza and a half mile from John Wayne Airport.

“As CityView continues to grow, we look to target housing markets such as Costa Mesa that exhibit high barriers to entry and robust employment fundamentals," says Sean Burton, president of CityView. "We are excited to have Red Oak as our partner given their strong local expertise in the market. Jointly, we look forward to creating a transformative project for the community that delivers strong returns to our investors.”

Even though development has been slow, there have been some multifamily trades in the area. As GlobeSt.com reported in September, CT Realty sold its Costa Mirage multifamily property at 393 Hamilton St. here to Cameron Properties Inc. for $12.9 million. The transaction was part of a plan to aggregate smaller properties in the coastal community of Costa Mesa, according to Raymond A. Polverini, SVP for CT Realty. The apartment projects were renovated and repositioned in the marketplace prior to being sold; Costa Mirage is the firm's fourth Costa Mesa property to be sold.