Highland Property Development Spends $28.5MM on Concord Apartment Complex

By Jon Peterson

Monrovia, Calif.-based Highland Property Development has paid $28.5 million, or $356,250 per door, to acquire the 80-unit Clayton Villa apartment complex in Concord located at 4450 Melody Drive, according to public records.

The buyer did not respond to emails seeking comment for this story.

The non-disclosed seller of the property was represented in the transaction by HFF. The transaction leader on the deal was Doug Childers, a managing director with the firm in its Atlanta office. HFF also did not respond to phone calls seeking comment for this story.

The seller of Clayton Villa also has the 74-unit Sutter Village asset on the market for sale in Yuba City. This asset has not been sold. Over the past three years the seller has invested on average of $2,100 in annual capital improvements across both properties.

Both properties are considered to be senior living apartments that target residents that are at least 62 years of age. They both benefit from having project-based Section 8 (HAP) contracts.

The new owner of Clayton Villa will be getting a mark-to-market contract rent increases. Based on a survey of the surrounding rental markets, average effective rents at Clayton Villa lag nearby comparable properties by an average of $310. The contract rent increases at this property will be $282 or 30 percent.

Clayton Villa was developed in 1978. The asset has several shared amenities like a community library, recreation room with full kitchen, controlled access, three laundry facilities and outdoor patios and picnic areas.

This complex is located in a market that has shown strong market fundamentals. The rental rate growth of similar properties in the submarkets surrounding Clayton Village has been 5.5 percent on a year-over-year basis. Occupancy as of the first half of 2017 in Clayton Villa’s Pittsburgh/Antioch submarket was at 96.2 percent. This represents the 12th straight year of an occupancy above 94 percent. This region has seen hardly any new units being developed, which makes the existing properties in the submarket that much more in demand.

Highland is known as a major investor and developer of affordable housing assets, according to its web site. The company two main markets are California and Texas.

West Coast Commercial Real Estate News