The mid-1980s asset at 655 S. Mesa Dr. had been acquired in 2004 by SRS Properties Inc. in Los Angeles for $8.2 million. However, like many complexes in the area, La Mesa Village ended up in foreclosure because it was overleveraged with a dwindling cash flow.
Furthermore, according to Alon Shnitzer, associate vice president, investments with Marcus & Millichap Real Estate Services, the asset experienced a huge drop in occupancy as a result of stricter enforcement of employed illegal immigrants. Shnitzer, who is marketed the asset on behalf of the lender says that by early 2009, occupancy fell to the mid-30s.
He tells Globest.com, however, that management company 707 Management Services Inc. has repositioned La Mesa Village and is working on leasing. Occupancy is now 45% and "they're continuing to push forward in the asset's lease-up," he remarks.
Some capital expenditure is underway, as are roof and ceiling repairs, exterior upgrades and parking repaving. In short, "someone could come in and buy this, and only do minimal capital expenditures," Shnitzer remarks.
Call for offers on the property is Sept. 23. Shnitzer says the ideal buyers would be those with private capital or a local syndication. "The lender is looking for buyers from either group," he adds. "The lender also wants someone who knows the market well."
La Mesa Village is situated on 9.4 acres, with a mix of one- and two-bedroom units. Unit sizes range from 536 square feet to 864 square feet. Rents are between $450 and $550 a month.
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