Covering 2.5 acres at 4055 Redwood Ave., Forty55 Lofts consists of 140-units in two-four-story buildings around a resort-style pool area with barbeques, a fire pit, and a decorative water feature. Residents also have immediate access to a 22-mile bike path running from Malibu to Redondo Beach. The units average 1,306 square feet and have 10- to 20-foot ceilings, oversized windows, large patios and high-end kitchens.

The investment flyer said the $70-million asking price was the result of capping the stabilized first-year pro forma at 5.0%, and then subtracting $2.5 million in lost revenue and other expenses associated with leasing up. It represents an 8.2% unleveraged IRR or a 10.4% leveraged IRR over a 10-year hold, assuming a 10-year rate of 6.0% and a debt service coverage of 1.25, according to the flyer, which listed rents in the $2,500- to $3,000-per-month range for adjacent developments. The sale closed toward the end of September. A spokesperson with Behringer Harvard declined to comment on the investment much beyond its press release.

Standard Pacific's Urban Division president Ram Fullen says that as the market conditions eroded during construction, "it became clear that selling the property to a rental investor was a viable alternative and economically a better strategy," adding that the vast majority of the apartments in the affluent beach community are at least 30 years old. Brett Betzler, the listing broker says the demand for high-quality rental product is very strong because Marina del Rey is close to the beach and LAX, and professional employment centers, such as Westwood and Century City.