PHOENIX-A California buyer has entered the market with the $8.1-million acquisition of the 150-unit Heatherwood Apartments. To fulfill the value-add plan, another $1 million has been dedicated for upgrades, inside and out.
Del Rey Property Group of Del Rey, CA bought a 90%-leased complex at 8603 N. 22nd Ave. "There's definitely room for an increase in rents after he improves the property," says Alon Shnitzer, associate with Marcus & Millichap Real Estate Investment Brokerage Co. In-place rents are $449 to $669 per month.
The buyer's rep says the market is so active that Del Rey Property could realize a somewhat quick return on the investment. "If he can capitalize on a booming market in a year or two, he'll sell," Shnitzer tells GlobeSt.com. "If not, he'll hold out and enjoy the income stream."
Shnitzer says Heatherwood's seller, Pedro Miqueo of Davis, CA, had bought the property three years ago for $5.3 million. "He got a big profit by putting it on the market now," he says. Marcus & Millichap's Ron Monat represented the seller.
Shnitzer adds Del Rey Property Group is looking for additional properties in the area. The parameters are 1980s construction or newer with 100 units or more. Heatherwood Apartments rose in 1983, a mix of studios and one- and two-bedroom units, ranging from 390 sf to 818 sf. ConAm Management Corp. in Phoenix has been hired to lease and manage it.
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