The 1031 Exchange buyers are two Laguna Hills, CA couples, with principals in development, architecture and accounting. David W. and Lauri Meredith and Duane and Wendle Heil, have paid nearly $3 million for Cortez Circle, built in the 1960s at 601 S. Cortez St. in Prescott, a favorite landing ground for California retirees.
Steven Brombal of the Newport Beach office for Phoenix-based Hendricks & Partners brought the buyers to the table for the seller's team, John Kobierowski and Greg Thielen in Hendricks' Phoenix office. Thielen tells GlobeSt.com that the deal was divvied into two seller-financed, 10-year loans: $2.4 million for the apartment complex and $550,000 for the 2.7 acres of extra land. The seller, Rosacci Family Trust of the Phoenix area, parted with the property after a 10-year hold because its principals are setting the stage for retirement.
The new owners plan to gate the property, completely make over the existing product and build out the undeveloped land. Thielen says six offers were placed for the offering, but the California couples scored the win with a high price beat the ask by $50,000. Both couples were turning around proceeds from multifamily sales in California.
"It didn't sell off the current income, it sold off the location and what you can do going forward," Thielen says of a complex with one vacancy. The mix has six studios of 500 sf, each renting for $398 per month; two tri-level one-bedrooms of about 700 per sf for $428; six standard one-bedrooms, also 700 sf, for $505; and 24 two-bedroom units, about 1,000 sf renting for $580. A 700-sf cottage on the grounds gets $435 monthly.
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