BREA, CA-KDF Communities LLC of Newport Beach, an affordable housing specialist, has expanded its project base with the acquisition of a 93-unit apartment complex here for $14.5 million, according to Marcus & Millichap. John L. Nguyen, a senior associate in the Newport Beach office of Marcus & Millichap, reports that KDF bought the property from McBride & Associates in a transaction that was brokered by Nguyen, who represented both the buyer and the seller.
The new KDF asset, located at 350 and 430 W. Imperial Hwy., comprises 55,800 sf. The complex features a mix of one- and two-bedroom units.
Nguyen notes that the property sold at 100% of the listing price at a record low cap rate of just under 3.9% and a gross rent multiplier of more than 13.2. "The cap rate was one of the lowest achieved this year in the North Orange County market," Nguyen adds.
KDF, which began in 1996 as a residential developer and has specialized in affordable housing projects, branched into commercial projects last year. On the residential side, the company has been involved in the construction, acquisition and rehabilitation more than 4,300 rental units in 25 cities in California, according to its web site.
KDF and another Newport Beach-based firm, CT Realty Corp., formed an entity called CT/KDF Community Development Partners last year that received a $90-million allocation from the US Treasury Department's New Markets Tax Credits Program, according to a GlobeSt.com report at the time. The partners said that they would principally use the funds to provide discounted equity to create infill mixed-use communities near transit-oriented sites in distressed areas.
Among KDF's largest multifamily undertakings was its acquisition last year of four apartment complexes totaling 691 units in San Jose for $74.6 million. The Newport beach-based affordable housing developer's plan for the properties included investing an additional $13.2 million to rehab and convert the units from market-rate to affordable housing.
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