Bascom Shells Out $66M for Tustin Complex

TUSTIN, CA-The Irvine-based Bascom Group has acquired the 628-unit Brookside Village Apartments at 13921 Tustin East Dr. from Denver-based Aimco for $66 million.

The sale, which closed last Friday, was a direct deal between Bascom and Aimco, owner for about six years. Gary Mozer and Lee Norman of Century City-based George Smith Partners Inc. arranging the financing. Jerry Fink, managing director, and Scott McClave, vice president of acquisitions, oversaw the transaction for Bascom, with David Kim, a Bascom managing director, getting set to manage an extensive renovation of the property to reposition it.

Built in stages from 1967 through 1975, the complex consists mainly of studio, one- and two-bedroom apartments in 62 two-story, garden-style buildings. The units average 815 sf, with monthly rents that range from $850 to $1,200. The complex was 96% occupied at the time of the sale.

The property features four swimming pools, spas, fitness center, saunas, tennis courts, clubhouse and covered parking. Features inside the units include private patios or balconies and walk-in closets.

Bascom says the remodeling and renovations will include a new roof, exterior paint, landscaping, signs and common-area amenities. Upgrades to the unit interiors will include new countertops and kitchen cabinet faces, carpeting and appliances.

McClave tells GlobeSt.com that the purchase of Brookside continues an increasing trend of investors buying in-fill apartment complexes in Southern California and investing capital into upgrades to better compete with new communities being built by developers. He explains the high cost of construction in developed areas like Orange County puts rents out of reach for most prospective renters, but investors who can buy an existing property at well below replacement costs can offer comparable quality units at lower rents and still generate a profit. For example, McClave explains, the cost of building new apartments in Orange County runs about $225,000 to $250,000 per unit, but Bascom’s cost at its new Tustin property will be about 40% below that, even after the cost of renovations.

Bascom has been an active buyer of apartments throughout Southern California over the past seven years, acquiring more than 10,000 units. It typically seeks value-add properties located in in-fill locations and repositions them.