Why Value-Add Investors Are Flocking to Glendale

Value-add investors are finding a goldmine in Glendale. The market has a healthy stock of vintage apartments in need of renovation, no rent control and rental growth averaging 4% annually. Champion Real Estate Co. is one of the investors taking advantage of the market fundamentals. The firm has acquired a two-property multifamily portfolio for $33.6 million with plans to invest $50,000 per door into the properties and bring rents to market rate. Arthur Arejian of Vanguard Investments brokered the deal, and says that he is seeing healthy activity from value-add players in this market. To find out more, we sat down with Arejian for an interview.

GlobeSt.com: Why has Glendale become such an active investment market for multifamily?

Arthur Arejian: A lot of equity capital is chasing Glendale because it is a non-rent control environment. Secondly, there is a hidden job market in Glendale, and there is an underground economy that fuels job growth. As a result, there is a tremendous amount of business that is tied to jobs, income and rents. The market has a great location on the map. It is in close proximity to Downtown Los Angeles, Pasadena and Hollywood, making it very centralized. And, the market has proven to have tremendous rent growth in the last six years. It has seen approximately 4% to 5% of rent growth each year. As a result, there are more than 6,000 new apartment units under construction in Glendale, and a lot of developers are chasing this market as well.