Which Tri-Cities Market Is Leading Multifamily Investment?

Glendale is quickly becoming the crown of the Tri-Cities submarket, seeing increasing investment activity, particularly in the multifamily sector. All three of the submarkets that make up the Tri-Cities—which includes Burbank, Pasadena and Glendale—are emerging as live-work-play environments, but Glendale has seen tremendous new multifamily construction, value-add investment and rising apartment rents, as well as office and retail growth. Champion Real Estate Co. has made a string of new investments in Glendale, including the recent acquisition of a 36-unit community located at 348 W. Chevy Chase Drive  and a 26-unit community located at 1119-1123 E. Elk Avenue, and the investor is bullish on the future growth in the market.

“As our recent investments in Glendale illustrate, we see this market in particular as a city that appeals to all ages with both a fantastic internal job base as well as easy access to other core job bases across the Los Angeles metro area including Hollywood, Downtown LA. and the San Fernando Valley,” Parker Champion, EVP with Champion Real Estate Co., tells GlobeSt.com. “Furthermore, with Caruso’s Americana, the revamped Fashion Center and Glendale Galleria offer a plethora of food and entertainment options for all ages. That coupled with strong schools and clean parks continues to illustrate the high quality of life that is available in the Tri-Cities. In addition to our recent acquisitions in Glendale, Champion has bought, developed and owned in Burbank and Pasadena as well. Such properties have included the mixed-use Burbank Collection in heart of downtown Burbank and the mixed-use Dalton across from the Pasadena Gold Line Station.”

Investor interest is growing in Glendale, and the competition is high to get quality multifamily assets. In addition to the high investor demand, opportunities to buy are limited, a combination which has helped fuel property values. “Competition was already fierce due to the lack of transactions within the market but has somehow become even more competitive as the attractiveness of Glendale to potential residents and investors continues to grow dramatically,” says Champion. The supply of rentable units in Glendale is largely bifurcated with the vast majority being either new construction, developed and managed by institutional operators with huge rents serving the upper end of the market or dated Class C+ product with comparably lower rents typically managed by long-term local owner-operators that are notorious for living on the cash flow and not reinvesting in any meaningful manner in their properties.”