CHATSWORTH, CA-Legacy Partners has acquired the 348-unit Waterstone Apartments complex from Sares Regis Group of Irvine for $52 million in a transaction brokered by Karoline Sauls, David Casper and Margie Molloy of Hendricks & Partners. Sauls and Casper tell GlobeSt.com that the $52 million was $250,000 above the asking price and that the property generated approximately 20 offers from a variety of prospective buyers.
"The price speaks to the demand for this type of property in the market," Sauls tells GlobeSt.com. Prospective buyers included family businesses, REITs, pension funds and private investment groups, all of whom recognized that the property is "irreplaceable real estate," according to Sauls and Casper.
Built in 1971, the Waterstone complex consists of studio, one-bedroom and two-bedroom apartments on an 8.6-acre site at 9901 Lurline Ave. The property, which was renovated in 1995 and 2001, was approximately 95% occupied at the close of the sale to Legacy.
The property occupies a site in the foothills of the Santa Susana Mountains with mountain views, walkways throughout the landscaped grounds and a host of amenities including a gated entrance, a clubhouse, a recreation room, tennis courts, sand volleyball courts, a swimming pool and barbecue areas, laundry facilities, a swimming pool, a spa and covered parking.
The Hendricks & Partners brokers cite the "enviable construction density" of less than 41 units per acre at the Waterstone, a density that would be impossible to achieve at today's construction costs even if land were available. Barriers to entry are formidable in the Chatsworth market in view of the high construction costs and lack of available land, the point out.
Not only is little or no new apartment construction likely to take place in the market, units are being taken off the market by condominium conversions, Sauls and Casper note. They say the new owner plans only minor improvements because the property has been well maintained and does not need any major upgrades in order to continue achieving rent growth.
The recent sale marks the third time that Hendricks & Partners agents have been involved in the sale of the Waterstone property in the past seven years. Sauls is based in the Hendricks & Partners West Los Angeles office, Casper in the company's Los Angeles office and Molloy in its Inland Empire office.
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