Danville Firm Picks Up 148-Unit Apartment Complex

VACAVILLE, CA-Morgan Park Apartments, a 148-unit class A luxury apartment community here has been sold for $24.8 million or $167,567 per unit, setting a new high water mark for the area. The new owner is Braddock & Logan Services, a Danville, CA-based real estate investment group. Morgan Park is situated in Solano County, 45 miles from the Bay Area and 30 miles from Sacramento. The complex includes eight, three-story buildings, a fitness center and a pool area with a spa and double-sided fireplace. The units range from two-bedroom/one-bath units to three-bedroom/three-bath townhome units ranging in size from 943- to 1,590 sf.The seller was a joint venture of San Rafael-based Silverwood Investments LLC, Holland Partners of Vancouver, Wash., and an institutional client of Boston-based AEW Capital Management. The disposition assignment was placed in the hands of Chicago-based Moran & Co.’s West Coast office, headed by Scott Davis.Davis tells GlobeSt.com that not only did the seller achieve a record per unit sales price, but also the new owner’s capitalization rate is a respectable 7%, based on projected 2005 NOI, which should grow in future years. “The constrained supply with continued population growth signifies great potential for above-average investment growth in the Vacaville market,” says Davis. “This region has registered the second greatest percentage increase in job growth in the state of California over the past 10 years,” notes Davis. “Vacaville accounts for 21 percent of Solano County’s total civilian employment base and prospects are that employment growth will continue to be strong in the area.”Several high-profile biotech companies have established campuses within five miles of Morgan Park, including Genentech, Alza Corporation, Chiron Corporation, DesigneRX and Large Scale Biologies, Inc. The region attracts businesses due to its combination of lower real estate costs and easy access to the Bay Area, says Davis.”The influx of these companies has contributed to average apartment rental market growth of 4.7 percent per year and very low average vacancy rate of 3.3 percent,” he says. “These figures were partially responsible for the large amount of investor interest in Morgan Park.”As well, Davis says the 10 pension funds and private investors who made offers liked the lack of existing multifamily development slated for the future in Vacaville. “It’s an area that has discouraged multifamily projects and continues to do so,” says Davis, adding that there is just one market-rate apartment community in the pipeline for the next three years.Braddock & Logan has a portfolio of more than 3,000 apartment units. The homebuilder and land developer also has built more than 33,000 homes since its founding in 1947.