MILL VALLEY, Calif. – January 20, 2014 – Colliers International recently closed the sale of the 38-unit Casa Roja Apartments in Mill Valley, and in the process set a new record for price paid per square foot for a multi-family asset, company officials have reported.
The sale price for the property equates to approximately $570 per square foot, a new record for a multi-family property (5+ units) in Marin County. The in-place cap rate was in the low 4 percent range, according to Colliers Vice President Ryan Wagner who, along with the firm’s Brad Lagomarsino and James Devincenti, represented the property owner, Red Island Real Estate LLC.
The 38-unit Casa Roja Apartments was originally built in 1964 and extensively renovated over the last 18 months. The property boasts a large central pool terrace, laundry facilities, and some of the most elegant interiors of any rental product in the region. The property is located just 10 minutes from the Golden Gate Bridge in southern Marin County, and tenants benefit from one of the best school districts in the entire state.
“This property generated tremendous interest from private and institutional investors, which just reinforces the demand for premium multi-family properties in the Bay Area and, specifically, in Marin County,” said Wagner. “There is a dearth of multi-family product in Marin County, with home prices simply out of the reach for so many, demand for the few Class A apartments in this area has dramatically jumped over the past few years and this is the perfect example.”
The buyer of the property was Woodmont Companies, a diversified real estate investment and management organization headquartered in Belmont, California. Since its founding in 1963, the company has been involved in the acquisition, development, and management of income properties exceeding $5 billion in valuation.
The seller of the property was Sausalito-based Red Island Real Estate LLC (RIRE), long known in the Bay Area for acquiring what it terms “irreplaceable assets” and then embarking on a program of improvements and renovations to bring them up to Class A standards, which is what it was in the process of doing when it sold the property. Red Island, LLC has received awards from Los Gatos, Mountain View and Belmont for its design and community improvement. The new buyer plans to continue to improve the property.
In what he called “typical” Red Island fashion, the company’s managing partner, Jim Ebert, said the partnership first acquired the property because it fit its typical profile: an exceptional and rare multi-family asset in an area where few such projects exist, an excellent location for commuters into the City, outstanding area schools, and a high standard of living.
Renovations completed to date have been comprehensive and have included such major changes as all new flooring, new windows, roof replacement, the reconstruction of all common area hallways, a new entry, plaster coating on all common area walls and ceilings, new heating and air conditioning units and new kitchens and bathrooms. According to Wagner, tenants in Mill Valley and Southern Marin are accustomed to paying rents that are commensurate with San Francisco pricing, approaching $4 per square foot.
“The citizens of Marin County have been consistently clear about not wanting additional, high-density housing developed in their neighborhoods, but of the projects that do exist there, they also have demanded that they be of high quality and style,” said Ebert. “That combination created the perfect environment for what we do. In fact, we were most proud that almost half of the residents who lived at the property before we purchased it still live there today; it is important to us not to displace residents who call our properties home.”
According to Wagner, “This property provides an excellent opportunity for Woodmont to continue the renovation and improvements, and further establish itself as one of the pre-eminent apartment communities in Southern Marin County.”
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