LOS ANGELES—Interstate Equities Corp. is targeting a different type of renter with its carefully crafted value-add investment strategy in Glendale: young families. The firm—which has been active in the Glendale submarket for a decade—has acquired the Towne at Glendale, a 126-unit multifamily property with a majority of three bedroom units, for $54 million. The property fits squarely within the firm's value-add investment strategy, but more importantly lets it target a different renter demographic than the young millennial set that so many apartment owners are after. Rather, Glendale is the perfect hub to attract a young family.
“Hollywood and Downtown Los Angeles have much more storied histories, but that is primarily the result of condos and apartment buildings targeting a younger millennial renter base,” Brendan Gibney, an acquisitions professional at IEC, tells GlobeSt.com about the difference between Glendale and other major growth markets in Los Angeles. “I wouldn't imagine that a lot of families are moving into those properties. Glendale is appealing to a different subset of tenants. Downtown Glendale has all of the retail offerings that your need, but you are a quick shot to Downtown Los Angeles. We think it is a nicely located submarket.”
IEC sees a gap between class-A and class-B rents, and an opportunity in vintage properties, like Towne at Glendale; however, it also sees an opportunity to capture the family renter that many apartment developers are ignoring. “There are 1,500 new units that are being built in the next two years, and I looked at the projects and there are very few three-bedroom units being built,” adds Gibney. “The majority of those units are targeted to millennials, where our asset is targeted more toward families. The competition for three-bedroom product is pretty static. We think that we can offer a product that is well amenitized and really compete.”
The location is also important. Glendale is part of the tri-cities market, making it accessible to both urban and suburban amenities. That is key, especially for a young family. “It is not in Downtown Glendale, but we really see that as an advantage,” says Gibney. “You have easy access to Downtown Glendale, but you are also right next to one of the best elementary schools in the area. You are not in the middle of everything, but you are close enough where you can get there pretty easily.”
IEC purchased the property with its IEC Institutional Fund III, a $200 million fund targeting value-add multifamily investments throughout coastal California.
LOS ANGELES—Interstate Equities Corp. is targeting a different type of renter with its carefully crafted value-add investment strategy in Glendale: young families. The firm—which has been active in the Glendale submarket for a decade—has acquired the Towne at Glendale, a 126-unit multifamily property with a majority of three bedroom units, for $54 million. The property fits squarely within the firm's value-add investment strategy, but more importantly lets it target a different renter demographic than the young millennial set that so many apartment owners are after. Rather, Glendale is the perfect hub to attract a young family.
“Hollywood and Downtown Los Angeles have much more storied histories, but that is primarily the result of condos and apartment buildings targeting a younger millennial renter base,” Brendan Gibney, an acquisitions professional at IEC, tells GlobeSt.com about the difference between Glendale and other major growth markets in Los Angeles. “I wouldn't imagine that a lot of families are moving into those properties. Glendale is appealing to a different subset of tenants. Downtown Glendale has all of the retail offerings that your need, but you are a quick shot to Downtown Los Angeles. We think it is a nicely located submarket.”
IEC sees a gap between class-A and class-B rents, and an opportunity in vintage properties, like Towne at Glendale; however, it also sees an opportunity to capture the family renter that many apartment developers are ignoring. “There are 1,500 new units that are being built in the next two years, and I looked at the projects and there are very few three-bedroom units being built,” adds Gibney. “The majority of those units are targeted to millennials, where our asset is targeted more toward families. The competition for three-bedroom product is pretty static. We think that we can offer a product that is well amenitized and really compete.”
The location is also important. Glendale is part of the tri-cities market, making it accessible to both urban and suburban amenities. That is key, especially for a young family. “It is not in Downtown Glendale, but we really see that as an advantage,” says Gibney. “You have easy access to Downtown Glendale, but you are also right next to one of the best elementary schools in the area. You are not in the middle of everything, but you are close enough where you can get there pretty easily.”
IEC purchased the property with its IEC Institutional Fund III, a $200 million fund targeting value-add multifamily investments throughout coastal California.
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