"This is a building where the buyer bought it on negative cashflow and he's looking to reposition," Brian Smuckler, a vicepresident and director of the national multi-housing group atMarcus & Millichap in Phoenix, tells GlobeSt.com. The propertyhad gone on and off the market for about one year before the latestdeal took shape.

The buyer, El Cajon, CA-based Cuatro J. LLC, beat out eightcompeting offers and closed escrow with seller Jonathan Holmes ofSan Jose, CA, in less than 30 days. The buyer brought a downpayment to the table, with the balance of the purchase price beingcovered by seller-provided financing.

"Basically it was a deal where the seller had employed severalmanagement companies. It was very mismanaged and had an excessiveamount of deferred maintenance," says Smuckler. "At closing therewere 10 units that weren't even rentable. The buildings needed anexcessive amount of capital improvement."