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SACRAMENTO, CA-Fairfield Development and GE Capital have sold 440 new luxury apartment units in North Natomas to Raycliff Partners LP for $54.56 million or $124,000 per door. The units are part of two separate developments located on adjacent parcels in the Sacramento suburb.

The Miramonte Apartments has 268 units and the Trovas Apartments has 172 units. Both developments were completed this year. Rent ranges from $1,000 to $1,550 per month for units that range in size from 714 sf to 1,275 sf. At the time of the sale, which closed last week, the combined properties were 98% occupied.

Arroyo & Coates handled both sides of the transaction. Pedro Arroyo represented the buyer in the transaction. The seller was represented by Curtis Gardner and Mark Leary. Leary tells the buyer is a private family that owns other North Natomas multifamily properties and was in the middle of a $45-million 10-31 Exchange, trading out of an office building in San Francisco.

Fairfield listed the properties with Leary as soon as they were stabilized at 90% occupancy. That was about 50 days ago. The list price was $125,000 per door or $55 million. “The same day we listed, the buyer wrote an offer,” says Leary. “We countered at $124,000 per door and he accepted.” Leary says the buyer paid all cash for the properties and is now seeking to rate lock a loan for the property. Leary expects he will be able to obtain a 10-year loan at an interest rate below 5%.

The purchase price on a per door basis is believed to be the second highest price ever paid for a Sacramento-area property. The McKenzie Apartments, also in Natomas, recently sold for $135,000 per door.

Sacramento was last year’s number one market in the Marcus & Millichap National Apartment Index. This year, it fell nine spots to No. 10. The forecast for 2003 is that vacancy will rise 0.3 percentage points to 5% due to weak job growth (1.5%) and rising construction completions (3,500 units, +11% from 2002). Rents are forecast to increase by 3.5% from 2002, pushing the average to $906.

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