By Meghan Hall
In a big transaction to round out the end of the first quarter, Spokane, Wash.-based SRM Development has sold its Baxter on Broadway multifamily development in Oakland. The sale of the 130-unit complex closed on March 31st for $81 million or about $623,000 per unit, according to Moran & Company. The buyer was Dr. Peter Wang and Grace Wang, a local family looking to invest in the commercial property market close to home.
“SRM was the developer, and they’re known for building very high-quality properties, which they oftentimes to hold long-term. So, they build extremely high quality and well thought-through property,” explained Jeff Williams, managing partner at Moran & Company. “And with the Wang family, it was a generational investment for them. It was one of the reasons why we thought there was an opportunity to match the two.”
The family was looking to take advantage of a 1031 exchange opportunity after selling a previous portfolio of assets in Kent, Wash. The long-term portfolio, stated Williams, was 1980s type product that required a lot of capital to reposition. The family ultimately disposed of the portfolio in an effort to reinvest in a newer, lower-maintenance opportunity closer to home.
The newly-completed development is located in Oakland’s Temescal neighborhood at 4901 Broadway. Units are a mix of studio-, one-, and two-bedroom units; four townhouses are also part of the complex. Apartments range from about 438 square feet in size to 1,300 square feet, while the townhomes are each around 2,600 square feet. Amenities include a bocce ball court, vegetable garden, rooftop and club room. 171 parking stalls and 7,418 square feet of retail are also part of the property.
“I think it is a bullseye development,” added Williams, when speaking of the development’s location and amenities.
Additionally, despite the rise of COVID-19, the long-term investment, Williams believes the asset is well-positioned to withstand a market contraction, thanks in part to the quality of the asset and the neighborhood itself.
“I think all of the themes we were in place pre-COVID are still in play: high-quality, walkable, access to great amenities,” said Williams. “…Also, there’s a long-term, well-developed, multi-racial, multi-generational community, and I think that’s appealing to people.”
Williams continued, adding, “The Seattles of the world, and the Bay Areas, all of the incredible tech businesses that are existing [here], that’s where a lot of the growth and opportunity will be in our economy, I think. So, it bodes well for the long-term.”
SRM Development is a privately-owned real estate company that specializes in multifamily housing product and mixed-use development in high barrier markets, including the San Francisco Bay Area and Puget Sound. The firm has built over six million square feet, totaling 4,500 apartment units since its founding in 1999.