Berkadia today announced the sale of a two-apartment portfolio for a combined $13.87 million in California. Senior Managing Director Dean Zander, Managing Director Brent Sprenkle and Director Mark Ventre represented the seller, Cypress Equity Investments, in the separate transactions, which closed in January. The properties located at 9212 Burke St. in Pico Rivera, California and 16275 Woodruff Ave. in Bellflower, California were purchased by NNC Apartment Ventures ($7.55 million) and Strattford Capital ($6.32 million), respectively.
Both assets represented an attractive option for the value-add opportunistic buyers who specifically target non-rent controlled assets with inherent upside and the ability to increase rents by upgrading the units during tenant turnover.
“We have seen a steady cap rate compression in secondary Los Angeles markets like Pico Rivera and Bellflower, as rents continue to rise and investors expand their geographic parameters to include these bedroom communities,” Ventre commented. “The assets have great bones, and we expect they will perform very well for the buyers, who both have terrific ground games in these areas.”
“The timing was impeccable for the buyers, who were able to get extremely favorable financing just days before treasuries began to increase in November,” Zander noted. “A combination of the seller’s quality property maintenance, along with the value-add component to improve rents over 30 percent from current rents, enabled us to secure numerous full price and even over list price offers.”
Built in 1964, Burke is a 44-unit, two-story wood-frame and stucco garden-style building with a central courtyard. The unit mix is composed of 37 one-bed, one-bath floor plans and seven two-bed, one-bath floor plans. Woodruff was built in 1963 and has 34 units, situated on a 38,333-square foot parcel. It contains 20 one-bed, one-bath units, and 14 two-bed, one-bath units. Each building has a courtyard pool with ample parking.