SEATTLE — On Friday, February 6, Security Properties, in a joint venture with Intercontinental Real Estate Corporation, purchased the 178-unit Saratoga Downs Apartments for $58,050,000 through its Security Properties Multifamily Fund II. The property, located inside the city of Napa, California is the latest of eight acquisitions in the fund.
Napa Valley is the epicenter of wine production in North America which is enhanced by a robust tourism industry. The City of Napa has undergone significant development in recent years and hosts a revitalized downtown with a variety of shops, restaurants, and lodging. In addition, Napa is located 45 miles from San Francisco and is exposed to the impressive economic catalysts in the greater Bay Area.
Saratoga Downs was built in two phases on land previously occupied by the Shevland Ranch that was once a horse farm and race track. The first phase was constructed in 2006 and features 124 garden style units. The second phase consisting of 54 townhome style units was constructed in 2012. The clubhouse / leasing office for the property is a completely reconstructed horse barn which maintained many of the original characteristics.
The property is well built and is one of only five Class A apartment communities in the city. The property is nestled in a neighborhood about two miles south of downtown Napa and neighbors the Napa Yacht Club, which features access to the Napa River that feeds into the San Francisco Bay.
According to Mark Hoyt, senior director of Investments at Security Properties, several factors prompted the pursuit of this asset.
“The North Bay has been a target market for several years as cap rates are higher and supply is restricted compared to adjacent submarkets. It is extremely difficult to build new product in Napa evidenced by the fact only two market rate apartment properties have been delivered in the past decade with two more projected to be delivered in the next decade. The quality of the property is excellent and we are proud to include it in our portfolio.”
Jessica Levin, director of Acquisitions at Intercontinental commented, “Saratoga Downs presents an opportunity to invest in a Class A apartment and townhome community in the supply constrained Napa market. We believe the appealing unit mix featuring 54 larger recently constructed townhome units combined with the neighborhood’s strong demographic profile, nearby retail amenities and employment centers makes Saratoga Downs a great long term investment for our investors.”
Seth Siegel and Jason Parr of Cushman & Wakefield represented the buyers and sellers in the transaction.
Intercontinental Real Estate Corporation is an SEC registered investment adviser with deep expertise in real estate investment, finance, development, construction management and asset management. Since 1959, Intercontinental has managed, developed, and owned over $8 billion in real estate property. Today, Intercontinental owns and manages a portfolio in excess of $3.7 billion for its clients. Intercontinental balances its portfolio both by robust property mix and by geographic diversification, while actively seeking opportunities to invest in both core and core plus, as well as value-add development projects. Visit www.intercontinental.net for more information.
About Security Properties
Security Properties is a national real estate investment and operating company headquartered in Seattle, Washington. For more than 45 years, Security Properties has provided quality housing to its residents as well as excellent financial performance for its investors. Since its founding, Security Properties has acquired or developed over 66,500 residential units at a cost of over $3.35 billion. Security Properties maintains a focused multifamily strategy supported by integrated teams of professional acquisition, development, construction, investment and property management specialists. For more information, visit www.securityproperties.com.