Paul and Rose Sharman, fueled by 1031 exchange funds, acquired the 22-year-old complex at 15615 N. 35th Ave. from a Los Gatos, CA-based partnership headed by Ron Tate. The Sharmans dovetailed the acquisition with the recent sale of three multifamily properties. As part of the exchange, the couple also acquired the 130-unit Loma Linda Gardens at 2925 N. Greenfield Rd. for $4 million.
"This complex is very clean and well occupied with beautiful landscaping," Richard Butler, a senior investment associate with Marcus & Millichap Real Estate Investment Brokerage Co.'s local office, says about the 98%-occupied Rancho Encanto. He tells GlobeSt.com that Rancho Encanto received at least 20 offers during its nine months on the market. It finally traded at a 7% cap rate.
The Sharmans, represented by Marcus & Millichap's Darrell Moffitt, assumed a $4.2-million loan from Fannie Mae to acquire the complex. The loan, which matures in 2008, has an interest rate of 6.91%, according to Butler.
Situated on 4.5 acres, Rancho Encanto contains 116 one-bedroom units, ranging from 442 sf to 685 sf, and 28 two-bedroom apartments, each 911 sf. Monthly rents range from $489 to $689.
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