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PHOENIX-A couple from nearby Carefree with 1031 exchange money to spend has acquired the 130-unit Loma Linda Gardens for $4 million. The 35-year-old complex was 60% occupied at sale time.

Paul and Rose Sharman bought the class C Loma Linda Gardens at 2925 N. Greenfield Rd. from Loma Linda Gardens LLC of Orangevale, CA. “The complex was attractive because of the low cost per unit and its location in a decent East Phoenix neighborhood,” Richard Butler, senior investment associate with Marcus & Millichap Real Estate Investment Brokerage Co., tells GlobeSt.com. “But, it was not in very good shape because it had very little money put into it over the years.” He says the Sharmans took over management and started repairs before the transaction closed.

Loma Linda Gardens sold for $30,769 per unit and traded at a 2.09% cap rate. “The property had very high vacancy and very high expenses,” Butler says. The listing baited six offers because of the value-add opportunity from a 60% occupancy, he adds.

The 2.6-acre Loma Linda Gardens has one, 450-sf studio; 63 one-bedroom units, ranging from 611 sf to 645 sf; and 66 two-bedroom apartments, ranging from 786 sf to 831 sf. Monthly rents range from $425 to $645.

The Sharmans assumed a $2.4-million loan with Bank of America to acquire Loma Linda Gardens. The loan, which matures in 2006, has an interest rate of 6.8%, according to Butler.

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