Located on 11 acres at 159 Aegean Court, the garden-style complex includes 110 two-bed, two-bath units, 48 one-bed, one-bath units and 10 three-bed, two-bath units. Including tenants who have signed leases but not yet occupied a unit, A&C broker Mark Leary tells GlobeSt.com that occupancy at the property is 99%.
"This is a classic add-value opportunity in a tight rental market with other renovated properties that support the upside potential," says Leary, who will call for offers in 30 days.
Rental comparables suggest that Canyon Creek could achieve significantly higher rents if it added washer and dryers and updated the kitchens, flooring, light fixtures and bathrooms, Leary says. For an example, he points to the Sommerset Apartments, which was recently renovated and is now achieving rents that are $175-$200 higher per month than Canyon Creek.
In addition, Leary says the current owner does not charge tenants for use of water, sewer and trash. At a utility reimbursement rate of 70%, net operating income would increase by roughly $90,000, he says.
The pro forma 2008 cap rate is 5.6%, which translates to an NOI of approximately $1.29 million. Based on 2007 actuals, the cap rate is 4.8%, which translates to an NOI of $1.1 million.
The property owner is listed as 159 Aegean Way Apartments LLC, whose address is listed as 48 North Hill Court in Oakland. The agent for the LLC is listed as Faina Gouikneaee, whose address is listed as 1244 Santa Fe in Hercules, CA.
In its just published forecast report, apartment brokerage specialist Hendricks & Partners says Vacaville, despite the housing slowdown, is benefiting from job growth. A $600-million expansion project by Genentech in Vacaville slated for completion in 2009 will result in 1,500 new jobs and the world's largest cell-culture biotechnology manufacturing facility.
In addition, a new Kaiser Permanente hospital will open in Vacaville by mid-2009, creating another 1,500 new jobs, and the State Compensation Insurance Fund, which, while remaining headquartered in San Francisco, chose Vacaville as the site for a new 1,200-employee facility.
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