RIVERSIDE COUNTY, CA-Sterling American Property Inc. of Great Neck, NY has acquired two apartment complexes totaling 924 units for $156 million in a joint venture with Dallas-based Westdale Asset Management. Tarak Patolia, head of acquisitions for Sterling American, tells GlobeSt.com that the company is close to closing on a third multifamily buy as part of a plan to assemble a West Coast portfolio of 5,000 to 6,000 units from San Diego to Seattle over the next 12 to 18 months.
The two properties are the 628-unit Waterstone at Corona Pointe at 1171 E. Baywood Dr. in Corona and the 296-unit Copper Canyon Apartments at 1234 W. Blaine St. in Riverside. The Sterling-Westdale JV acquired the two properties from Portland, OR-based Scanlan Kemper Bard.
Patolia tells GlobeSt.com that the acquisitions are a combination of value-added and market plays for Sterling American, which plans to spend approximately $3.5 million on upgrades to the two properties. "There is definitely a value-added component to this, but we also believe very strongly in the market, and we think that in the next five to 10 years, Corona and Riverside and the rest of the Inland Empire region will enjoy high rent growth because of shortages of housing and the positive demographic trends," Patolia says.
The $3.5 million of capital improvements will consist primarily of upgrades to the individual units. The new owners see the potential for upside both through higher rents and through improving occupancy, especially at Copper Canyon, where the occupancy is about 80%. Occupancy at the Waterstone is approximately 91%.
Waterstone, built in 1987 comprises 52 two-story buldings near the Intersection of Interstate 15 and the State Highway 91 Freeway. Copper Canyon, built in 1986, consists of 27 two-story buildings about three blocks from the University of California at Riverside campus.
Scanlan Kemper Bard acquired the Copper Canyon Apartments for $36.5 million in 2005 and the Waterstone at Corona luxury apartments in 2006 for $98 million. It bought both of the properties in partnership with Griffen Investments LLC.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.