The seller was San Leandro Project Investors, which is based in Northern California. The buyer was San Diego-based Investment Advisors.
The Timbers Apartments is a garden-style complex constructed in 1975. The fully gated community has recently undergone $700,000 in improvements. The unit mix includes 93 one-bedroom, 61 two-bedroom and 32 studio apartments, ranging in size from 476 sf to 851 sf. Monthly rental rates range from $863 to $1,238.
The $17.4 million sales price represents $93,548 per unit and $135 per sf. The capitalization rate on the investment was 7.7%. Occupancy is currently 93%.
Stanford Jones and Kevin Turner, investment specialists in Marcus & Millichap's Palo Alto office, had the exclusive disposition assignment and ultimately brokered both sides of the transaction. According to Jones, the property appealed to the buyer because of its below market replacement cost as well as the significant upside potential it presented through refurbishment and repositioning.
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