The complex has been sold by Pacific Gulf Properties, the REIT that has been slowly shedding its assets for more than a year. The property, Daisy 7-11, was one of the last remaining apartment complexes in Pacific Gulf's Southern California apartment portfolio. The portfolio consisted of 11 apartment properties with a total of 1,369 units and a combined consideration of more than $107 million.
Sean Deasy of CB Richard Ellis represented the buyer, Eagle Real Estate Group, and the seller in the transaction.
"The Diamond Bar sale is further testament to the strength of the multifamily investment market," Deasy says. "Despite potential concerns about a softening real estate market and the impact of the energy crisis, the reality is that California is experiencing a housing shortage and multifamily is a key component to providing much-needed housing."
In addition to its multifamily assets, Pacific Gulf has also shed more than $800 million in industrial properties. Shareholders had given the green light to liquidate the company last November, and in March Pacific Gulf was discussing a merger deal with FountainGlen Properties LLC, an affiliate of Prudential Real Estate Investors. The deal would allow Prudential to acquire Pacific Gulf's corporate office facility and senior multifamily complexes for $143 million. In addition, Prudential would assume $65 million in debt.
The merger, however, hit a snag in late March when a class-action suit was filed against Pacific Gulf Properties. The suit alleges breach of fiduciary duty against the REIT's directors in approving the merger and states that $143 million in consideration for the acquisition of the office facility and the senior multifamily complexes is inadequate.
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