"It was a case of a tired owner and a very experienced investor that owns thousands of units in Los Angeles and Las Vegas," Neil Sherman, senior adviser with Sperry Van Ness of Scottsdale, tells GlobeSt.com, referring to former owner Signet Partners of Denver and buyer SRP Property Inc. of Los Angeles.
The two-story, garden-style complex, located at 17602 N. Cave Creek Rd., was suffering from a 28% vacancy rate when it was put on the market about four months ago at $5.7 million--a figure that was about $1 million less than Signet Partners paid for the property four years ago, Sherman says. "Part of the problem was that it had out-of-state ownership and lackluster management," he says of the complex's plummeting sale price. But it was exactly the type of complex that fit SRP Property's criteria.
"We had an opportunity buyer looking for properties with problems that can be addressed to turn the property around and this was an absolute candidate," says Sherman, who negotiated the transaction on behalf of both the seller and buyer.
The apartment complex does have potential. Located just a short distance from three of the Valley's freeways, it features two pools, spa and a mix of studio, one- and two-bedroom apartments with rents ranging from $450 to $600 per month. Sherman says the new owner plans to take "a hands-on approach" to increasing the complex's sagging occupancy rate by hiring a local management company and mounting a solid leasing campaign to fill up the 46 vacant units.
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