Brookstone Apts. Changes Hands for $38M

BUENA PARK, CA-Patrick Cadigan has purchased the Brookstone Apts., a 184-unit multifamily community here, for nearly $38 million from L&B Realty Advisors. The Cadigan portfolio now encompasses 11 Orange County apartment complexes totaling nearly 1,800 units.

Cadigan was represented in the transaction by Carl Greenwood and Jim McKenzie of Greenwood & McKenzie, while Shane Shafer, Dean Zander and Vince Norris of Hendricks-Berkadia represented L&B Realty. The asset was marketed as a stabilized asset offering significant reposition and value-add opportunity with proven upside potential.

Located between Beach Blvd. and Knott Ave., Brookstone is on the corner of Artesia Blvd. and Western Ave. The complex consists of 17 two-story buildings, situated on nearly 7 acres, with carports around the perimeter of the property. The unit mix contains 61% one-bedroom/one-bathroom, 22% two-bedroom/one-bathroom and 17% two-bedroom/two-bathroom floor plans.

Unit interiors feature air conditioning, ceiling fans, washer/dryers, dishwashers, microwaves, refrigerators, extra storage and accent walls. Over $1.6 million in recent renovations have been completed including upgraded panel cabinet faces, designer light fixtures and two-tone paint.

Brookstone is surrounded by major employers such as the Entertainment Zone of Buena Park, which hosts more than six million visitors annually and is projected to increase to 10 million annually by 2020. Prologis recently finished its Phase II development of the Prologis Park at Mid-Counties Distribution Center, a few blocks from the property, which consists of more than 1.2 million square feet of distribution space.

In addition, the Source, located at Beach Blvd. and Orangethorpe, which is the first major retail complex slated for Buena Park in decades, is set to open in 2014. Upon completion the site will host a 480,0995-square-foot shopping center, 50,000 square feet of office space and a 151-room hotel, and it will provide 5,000 future jobs.

After considerable interest from prospective buyers during the 30-day marketing period, the transaction closed within 60 days. According to Zander, Norris and Shafer, “The location enables the property to continue taking advantage of the tightening rental market in Orange County, and, coupled with the property's desirable unit mix and investment upside potential, the asset provides an investor an ideal opportunity to increase income through upgrades and thoughtful management.”

As GlobeSt.com reported in August, the number of housing-permit requests in Orange County has swelled considerably since 2010. According to Hendricks-Berkadia, multifamily permit requests have increased by 197.8% since 2010, and single-family permit requests have followed a similar trajectory.