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Essex Picks Up 178-Unit Apartment Tower

OAKLAND, CA-The Palo Alto, CA-based apartment REIT pays $21.2 million to Statewide Acquisitions Corp. for Regency Tower Apartment Homes, an 18-story multifamily property here that is about 95% leased.

By Brian K. Miller | Updated on March 02, 2005

OAKLAND, CA-Essex Property Trust is the new owner of Regency Tower Apartment Homes. The Palo Alto, CA-based apartment REIT paid $21.2 million for the 18-story, 178-unit property, which is well leased and located a couple of blocks from Lake Merritt. The seller was Statewide Acquisitions Corp. The lone broker in the transaction, Richard Knutsen of Moison Investment Company tells GlobeSt.com that Statewide Acquisitions, which acquired the building in 2002 for $14.7 million, invested upward of $2 million renovating the property. “(Statewide) did two-thirds of a rehab,” says Knutsen. “Essex stepped in to complete the upgrade.” Regency Tower Apartment Homes was developed in 1975. It include 34 one-bedroom, one-bath units that average 971 sf and 144 two-bedroom, one-bath units that average 1,013 sf. The building provides views of Oakland Hills, Lake Merritt, and the San Francisco Bay. It is located near a BART station and near Lake Merritt, “an area expected to benefit from improving economic conditions in Northern California,” says Essex chief executive Keith Guericke in explaining the investment. Essex made the acquisition through its primary investment vehicle affiliate, Essex Apartment Value Fund II, of which Essex owns a 28.2% interest. The fund also originated a new mortgage loan on the property. The $11.5-million loan carries a fixed interest rate of about 5.1%, matures in February 2014 and has a 1-year variable rate extension option.

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