Equity Residential Acquires 104 Units for Conversion

SEATTLE-Equity Residential is the new owner of Viewpoint, a 104-unit apartment complex here that sits across Sand Point Way from the old naval yard and Magnuson Park, both of which back up to Lake Washington. The Chicago-based multifamily REIT paid $98,557 per unit ($10.25 million) for the 1980s development, which it plans to convert to condominiums. Located at 7307 NE Sand Point Way, the units have high ceilings and some have views of the lake, according to anonymous reviews by renters dating back to December that also complained about thin walls, management and a lack of parking. The size of the units was not immediately available. Equity Residential acquired the property under EC-Magnuson Ridge LLC, which is affiliated with its condominium conversion group. The seller, Coast Properties LP, is a local family partnership, according to the broker in the deal, Kenny Dudunakis of Hendricks & Partners’ local office.Dudunakis tells GlobeSt.com the property consists of two buildings with larger townhouse-style units. If the property were being kept as apartments, the cap rate on EQR’s investment would be below 5%, he says. A source at EQR tells GlobeSt.com that its condo conversion group has been in operation since 2002, though activity did not pick up until 2003. Prior to the Seattle acquisition, the division has converted seven multifamily properties from its portfolio, including two in the Seattle area: Country Club Estates in Mill Creek and Sterling Heights in Bellevue. EQR’s conversion activity so far in 2005 was not immediately available, but the source says EQR plans to convert about 1,800 units in 2005. The company looks to convert properties in markets where it already has a presence, he says. Equity Residential is the largest publicly traded apartment company in America. Nationwide, it owns or has interests in 199,292 units in 938 properties in 32 states and the District of Columbia.