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948-Unit Apartment Complex Fetches $192M

SAN JOSE, CA-Archstone sells the property to Laramar Group of Chicago, which is re-entering the West Coast multifamily market with $100 million of equity to invest.

By Brian K. Miller | Updated on July 08, 2008

SAN JOSE, CA-The Laramar Group of Chicago has opened a California office and acquired the 948-unit Archstone San Jose apartment complex for approximately $192 million with plans for a repositioning. The sale price represents an initial capitalization rate in the 5% range, Laramar chief executive Keith Harris tells GlobeSt.com.

Laramar acquired Archstone San Jose for its Laramar Multi-Family Value Fund, which launched with $350 million of equity in 2006 and now has in its portfolio 17 properties and $100 million of equity left to invest. The seller was Archstone, which was taken private last year by a JV of Tishman Speyer and Lehman Bros. Archstone owned the property for 12 years.

“Historically we’ve had a lot of ownership in California and it feels like the time we want to re-enter,” Harris says. “We acquire properties that need to be repositioned and we like investment opportunities where there is distress and California like the rest of the county is seeing various forms of distress. We also like to invest in major markets with good population growth, good employment growth and good rental metrics, and California has that as well.”

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