"The prices were pretty steep because of the rehabbing for conversion," Vaughn observes. "You're not going to find regular investors who can pay these high prices, but given how quickly Guardian stepped in, I think eventually there would have been a lot of interest."

What's most significant, Vaughn adds, is that the sellers did not lose money. "Not only did they pay a higher price originally because they were slated for condo conversion, they also invested a lot of money on upgrades. When we sold them, we got the sellers out whole while still leaving some meat on the bone for the new buyer," she says.

Guardian Management owner and president Tom Brenneke says he and his team have "hit the ground running" on leasing the properties. "We ended up with substantially vacant buildings so we're launching immediately into lease-up. We normally acquire and rehab, but with that out of the equation, it's pretty intense," he says.

Vaughn says the Phoenix-area rental market is strong, with rents heading upward. She and Brenneke agree the market is likely to soften somewhat because of the number of failed condo conversion units returning to the rental column.

"There are certainly some short-term concerns because of units coming back, but we feel very good about Phoenix in general and Mesa specifically. The fundamentals long-term are excellent," Brenneke adds.

Brenneke says Guardian and Morgan Stanley are continuing to look for additional opportunities in the market and expect to close Aug. 31 on the $9-million purchase of the 120-unit Monarch Apartments in central Phoenix. Guardian owns properties in seven states. The company's management portfolio consists of more than 150 properties in Oregon, Washington, Idaho, Montana, Texas, Arizona and Alaska. Jason Hicks, also of Sperry Van Ness in Phoenix, teamed with Vaughn on the buyer's side of the two deals.