(Read more on the multifamily market.)
TEMPE, AZ-Bronco Real Estate Corp. is continuing its buying pace in the market, adding the 211-unit Cameron Creek Apartments for $18.8 million through an off-market transaction. The San Rafael, CA-based buyer has earmarked another $2 million for upgrades to the class B complex.
Todd Braun, a senior director in Phoenix for Cushman & Wakefield of Arizona Inc., says Mohammad and Susan Ehsan of San Diego, CA decided to sell the asset at 1975 E. University Dr. in an off-market transaction to prevent major disruptions to management. "The buyer likes those types of opportunities, deals that aren't on the market, so he was interested when we approached him" says Braun, who brokered the deal with C&W directors James Crews and Brett Polachek.
Braun tells GlobeSt.com that Bronco assumed existing debt representing about 70% of the acquisition price. He says the buyer plans to add value through capital upgrades and management changes. Greystar Management of Austin, TX has been hired to manage and lease the 92%-filled complex.
The Ehsans acquired the 20-year-old Cameron Creek in 2002 for $11 million. Braun says when they decided to sell that Bronco was one of the first choices. "We've been staying in pretty good contact with Bronco and know they'll perform," he adds. "The ability to close was important to this particular seller and we thought it would be a good match."
Situated on 9.92 acres, the 12-building Cameron Creek Apartments has one- and two-bedroom units averaging 894 sf. The average monthly rent is $805. Braun says rents could increase as much as $45 per unit after renovations are done.
Braun says Tempe is popular with investors because it is land-locked with high barrier to entry for new construction. Additionally, the city is a good employment center and home to Arizona State University. "All things considered, this is a pretty attractive geographical area where investors are trying to buy product if they can find it," he says.
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