CT Realty Sheds Pacific Breeze Complex

OCEANSIDE, CA-Newport Beach-based CT Realty Corp. has shed an Oceanside apartment asset from its San Diego County multifamily portfolio, having sold the Pacific Breeze Apartments for $44.8 million. Oceanside Breeze Ventures LLC, which counts Woodland Hills-based Troxler as one of its managing partners, has picked up the 280-unit complex with plans to convert the property into a condo asset.”There are a significant number of condo conversions taking place in North San Diego County and my belief is that the buyer is going to make a ton of money in the process,” CT Realty senior vice president Ray Polverini tells GlobeSt.com. He says that the “condo conversion mania” that has gripped San Diego County was one of the main factors that prompted CT Realty to sell the asset. In addition, “cap rates have fallen very hard, very fast,” Polverini points out, explaining that “people will pay a lot for cash flow and so we looked at the opportunity that was driven by that as one of the components of our decision.” In addition, company officials considered the debt that CT Realty assumed when the property was purchased and realized that the asset was “not a great thing to sit on,” Polverini adds. “We had not held the property for as long as we thought we would, but with the handful of things coming together, it looked like a reasonable opportunity to exit early,” he tells GlobeSt.com.CT Realty had originally planned a three-year hold for the multifamily asset that it had acquired in September 2002 from Dallas, TX-based Archon Residential. “We looked at the fundamentals of the demand for apartments in general, and we started to test the waters on a quiet basis with a buyer,” Polverini says. However, the deal did not pan out, due to the high mortgage involved. “Because of the debt, it made it difficult for an apartment buyer to get to our number,” Polvereni notes, explaining that “with the mapping that had been done on the property for condominiums, it did provide us a good opportunity to sell to a condo converter.”Built in 1988 with a condo map in place, Pacific Breeze Apartments is located at 3522 Vista Way. Amenities here include oversized patios, kitchens with greenhouse windows and private garages, as well as a tennis court, two swimming pools, a spa and a fitness center. CT Realty invested more than $1.6 million in improvements to the property during its ownership period, with upgrades entailing landscape renovations, interior improvements, construction of additional onsite storage facilities for residents, and a playground. The unit mix consists of one-bedroom and one-bath designs, as well as two-bedroom, two-bath floor plans. The property was 94% occupied at the time of sale. Both parties were represented in-house in the recent transaction.