FORT WORTH-Three more 1031 exchange buyers from California have gained control of multifamily properties in Tarrant County. One is a class B sale and the other two are class Cs, but all assets have occupancies at more than 90% to set up plays for rent hikes over time.

In Euless, a 1031 partnership from San Francisco has paid about $11.5 million for the 346-unit Wood Hollow Apartments at 3875 Post Oak Blvd. in an off-market deal, says Mike Burch with the Dallas office of Hendricks & Partners. He tells GlobeSt.com that he believes that the recent increase in Tarrant County sales “is more coincidence than anything else, but the Mid Cities does have some good investment guidelines.” Brokers have reported at least six other sales in the past two weeks in the county.

Burch says Shore to Shore Properties plans to make some upgrades although the 95%-leased asset is “in good condition. The one- and two-bedroom apartments average 727 sf while the average monthly rent is $603. The seller was 346 Wood Hollow Ltd. of Fullerton, CA.

In Fort Worth proper, Scott Gigliotti in the local office for Boston-based United Multifamily Co. reports that he sold the 106-unit Handley Oaks Apartments at 2120 Handley St. for $2.55 million in a reverse 1031 exchange to a San Diego investor, who immediately moved on site to oversee the acquisition. The buyer had Texas Reverse Exchange Holding Co. LLC as its broker for a deal that went from contract to close in 31 days. Rattiken Title Co. of Fort Worth managed the closing.

The 12-building Handley Oaks was 97% leased at sale time by its six-year owner, BITA Ltd. of Fort Worth. The listing baited six offers–one local and the balance from California–in a market run at $2.65 million, according to Gigliotti. “It’s all about cashing out,” he says.

Gigliotti says the new owner, who sold multifamily assets in San Diego, plans to undertake a renovation of the 4.5-acre property, which abuts a Wal-Mart Supercenter. The unit mix, of which 25% are Section 8 tenants, has apartments ranging from 620 sf to 1,095 sf in one-, two- and three-bedroom floor plans. The monthly rents are $450 to $825.

“It you are a buyer in today’s market, you have to do a lot of looking,” Burch says about the sales uptick in Tarrant County, particularly Mid Cities. “You can’t always buy in Preston Center. You have to look under the radar screen to catch some of those submarkets that may have been overlooked. There is always something to be said for buying a solid deal where you get the gradual upside of rent increases in a market that is improving. Not every deal has to be an immediate upside.”

In Hurst, Chris Deuillet with Marcus & Millichap Real Estate Investment Brokerage Co. got more than $33,000 per door for the 224-unit Oaktree Village Apartments at 200 N. Booth Calloway Rd. He says the buyer from San Francisco closed the deal on the last day of his 1031 exchange deadline. The seller is a local investor, closing out a 16-year hold, because “he knew now was the time to sell,” Deuillet says, citing the heated sales market.

Oaktree Village, with one empty apartment, “is a class C in a class B area,” Deuillet says. He had four offers in three weeks with two at the $7.25-million full list, driving the final price slightly higher than the ask and the cap rate to 8.54%.

The new owner secured a five-year loan with a 6.3% fixed-rate interest from Capmark Financial Group’s Murrieta, CA office. Devonshire Management Co. of Dallas will oversee the property, a mix of one- and two-bedroom apartments ranging from 450 sf to 1,080 sf. In-place rents are $399 to $699 per month.

“The Mid Cities historically has not seen a lot of transactions,” Deuillet says. “We’re at the point where occupancies have inched up and owners of these properties are now seeing the return they want and are letting these properties go.”