$55M Buys Student Apartment Complex

Chase tells GlobeSt.com that the property commanded the $260,000 per unit, a top price for the Inland Empire, for a variety of reasons that included its unique range of amenities, the unusually high rents that it generates, its location near the 400,000-sf University Village retail/entertainment center and the overall quality of the asset, which was built in 2001.About 75% to 80% of the units in the complex are four-bedroom apartments, each with its own separate bathroom, Chase explains, and with four students each paying rent in a four-bedroom apartment the large units generate higher rents than typical apartment units elsewhere. Because of the predominance of large units, the complex generates an overall average of $2,612 per month per unit. The apartments, which average 1,311 sf, also include one-bedroom and two-bedroom units."The property generates higher income per unit based on the fact that each resident pays a higher rent per bedroom than an owner would get in a conventional apartment building," Chase says. "It's more expensive to build this way, but you generate a lot more revenue." The units command higher rents because of the unique package of amenities: Rent includes not only the apartment but also telephone, high-speed Internet access, water and electricity, trash pickup, gas, heating and air conditioning, basic cable TV, full kitchen appliances, full-size washers and dryers, refrigerators and built-in microwave ovens. Other amenities include a 15,0000-sf student center, a fitness center, a study center with computers, two conference rooms for group studies, barbecue areas, a swimming pool and a spa.The GrandMarc, which was 100% occupied at the time of the sale, sits on a site of nearly 12 acres near the 215 Freeway, at 3549 Iowa Ave. at the corner of Iowa and University avenues. Its 212 units, all fully furnished, are in six four-story buildings and provide 760 beds.The GrandMarc was one of two large deals closed in recent days by the team of Chase, Palmer and Quintana. The other was Essex Property Trust's $60-million acquisition of a 278-unit San Jose apartment complex called the Esplanade.