An Essex Property Trust affiliate has bought two apartment communities in Santa Clara County, California, for a total of $240.5 million, a move that continues the REIT's bet in Northern California. Both are located in Campbell.
One was a 252-unit asset at 215 Union Avenue, which went for $122.5 million, as reported by Silicon Valley Business Journal, citing property records with the county. Called Parc at Pruneyard Apartments, the community offers a luxurious experience with one and two-bedroom units, along with amenities including a swimming pool and a fitness center.
The other was located at 1725 South Bascom Ave, which traded to Essex for $118 million. The complex features 168 units.
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Land and Houses USA was involved in the sale of both multifamily properties.
Most notably, Parc at Pruneyard traded for just roughly $99.8 million in 2016, which would imply that the value has increased by more than $20 million since, according to data from PropertyShark. Meanwhile, the other property was sold at a modest $900,000 discount when compared to its 2017 sale of about $118.9 million.
The transaction continues on Essex's Northern California acquisition activity that is began this year. In a first-quarter earnings call, Angela Kleiman, CEO and president of the REIT, said that it had already made $345 million worth of acquisitions in the region alone to start the year. She said they have been funded by dispositions in Southern California.
"This reallocation into higher rent growth markets and further optimization of our operating platform will enable us to generate above market returns," Kleiman told analysts on the call.
Overall, the company is currently bullish on the Northern California market, as new lease rates in the region led its portfolio, at 1.5 percent. That was followed by Seattle at 1.3 percent, with Southern California down at the bottom. Moreover, Kleiman noted that Essex is "pushing rents" in Northern California.
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