Los Angeles, CA – TruAmerica Multifamily in partnership with Intercontinental Real Estate has closed on its largest acquisition in the San Francisco Bay Area with the purchase of Maribelle Apartment Homes, a 287-unit garden style apartment community in Santa Rosa, CA for $59 million. The transaction represents TruAmerica’s fifth joint venture encompassing almost 1,300 units with Intercontinental.
Built in 1987, Maribelle Apartments is the biggest apartment community in Santa Rosa. It features a mix of one- and two-bedroom apartment homes on a low-density 13.4-acre site and includes a clubhouse fitness center, resort-style pool, dog park and picnic areas with barbecues. The property has easy access to US 101 and California State Highway 2 and is near the soon-to-be-completed Santa Rosa Station of the Sonoma Marin Rail Transit Service. It is well located within walking distance to the Historic Railroad Square and Downtown districts and within a three-mile radius of 2.5 million square feet of retail, dining and entertainment options.
TruAmerica specializes in identifying, acquiring and repositioning mid-tier apartment communities to provide high-quality rental housing for working families in growth markets throughout the Western United States. Since acquiring its first asset in San Jose, CA in 2013, the Los Angeles-based investment firm has become one of the most actives buyers of multifamily properties in the United States, building a portfolio of nearly 10,000 units including over 1,000 in the San Francisco Bay Area.
“There is probably greater demand for workforce housing in the Bay Area than any other region in the United States,” said Greg Campbell, Senior Managing Director of Acquisitions for TruAmerica. “Unlike many large cities where economic growth is limited to a particular area, the Bay Area is continuing to experience strong economic fundamentals across an entire region which stretches more than 100 miles from San Jose to Santa Rosa.
San Francisco and the Peninsula have experienced 46 percent and 50 percent respectively in rent growth over the past four years, according to Real Facts. This has put additional upward pressure on rents in outlying areas. In Santa Rosa, which is 50 miles north of San Francisco, rents have increased approximately 28 percent over the same period.
Rents should continue to climb in Santa Rosa, which already boasts an average rental occupancy rate of 97 percent, as there is very little product in the pipeline. According to Marcus& Millichap’s Institutional Property Advisors, who marketed the property on behalf of Fairfield Residential, construction of new apartment inventory has been limited due to the city’s historically controlled growth approach to residential development. Approximately 70 percent of the city’s 6,600 units were built before 2000.
“At our cost basis, we will be able to upgrade the property while still keeping rents in line for working class families,” added Jessica Levin, Director, Acquisitions for Intercontinental. “This acquisition falls squarely into our value add investment strategy of which TruAmerica shares a similar mission and has been a fantastic partner.“
TruAmerica’s investment will benefit from a seven-year, interest only, fixed rate agency loan originated by Brian Eisendrath and Cameron Chalfant at CBRE Capital Markets, Inc.
About TruAmerica Multifamily
TruAmerica Multifamily is a vertically integrated value-add multifamily investment firm based in Los Angeles. Founded in July 2013 as a joint venture between Robert Hart and The Guardian Life Insurance Company of America, TruAmerica has been one of the country’s most active multifamily investors and manages a $3.8 billion portfolio of almost 19,000 units across prime locations throughout Northern and Southern California, Washington, Oregon, Colorado, Arizona and Utah. For more information on TruAmerica Multifamily, visit www.truamerica.comor.
About Intercontinental Real Estate Corporation
Intercontinental Real Estate Corporation is an SEC registered investment adviser with expertise in real estate investment, development, asset management, and construction management. Since inception in 1959, Intercontinental has managed, developed, and owned over $10 billion in real estate property. Today, Intercontinental owns and manages a portfolio in excess of $4 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.