REIT Buys Fremont Apartments for $112.5M

An unnamed REIT has acquired The Rexford, a 203-unit apartment property in Fremont, California, for $112.5 million from The Ezralow Company, a developer. The transaction sets a new record as the largest single apartment sale in the market’s history.

Located at 3400 Country Drive on more than 8 acres in Fremont, California, the property features 18 buildings with a mix of one-, two- and three bedroom apartments and townhomes. The property was fully renovated by the previous ownership to the tune of $13 million, giving the REIT the opportunity to buy an upgraded apartment community in a popular Bay Area suburb.

The property also features a clubhouse and lounge, a fitness center, two swimming pools with surrounding BBQ and picnic areas, a community bike storage room, package lockers and landscaped walking paths. Plus, it is walking distance from Downtown Fremont and the Fremont BART station.

The transaction is a sign of optimism for the Bay Area multifamily market, which was badly impacted by the pandemic. After a challenging 2020—when rents fell to the lowest levels in years as people fled the city for more space and lower cost of living—2021 has been a year of recovery. By this summer, rents had already rebounded significantly. Berkadia Institutional Solutions’ concessions survey found the market has rapidly rebounded in only the last 90 days. At the end of March, apartment concessions offered 7.1 weeks of free rent, and by the end of June, concessions decreased to only 3.2 weeks.

As a result of the swift recovery, transaction volume has also made a swift return this year. The San Francisco market has recovered more than 80% of pre-pandemic multifamily transaction volume, in what one firm is calling the ultimate “comeback story.” A recent analysis by Reonomy notes that “multifamily investors are betting on the continued affluence of San Francisco,” despite rent declines in some Bay Area cities that are among the biggest in the US.

Newmark senior managing director Nate Oleson, executive managing director, Mark Leary, director Rob LeDoux and director Ian O’Connor brokered the deal.