TEMPE, AZ-Fairfield Residential Co. LLC made its second area buy in the past couple of months, paying Farnam Realty $22.65 million for ownership rights to City Scape at Lakeshore. The Southern California buyer adds the 214-unit City Scape to its purchase of the 408-unit Tempe Grove Apartments, on which it closed in early September.
Fairfield Residential, which had once been very active in the Phoenix market, filed for Chapter 11 in 2009, a victim of the faltering economy and maturing loans. In recent weeks, however, Fairfield and partner Brookfield Asset Management of Toronto closed its Brookfield Fairfield U.S. Multifamly Value Add Fund, with total commitments of $323 million. As a result, "they have fresh equity and they're underwriting a lot of deals," comments Alon Shnitzer with ORION Investment Real Estate in Scottsdale, AZ. Shnitzer teamed with ORION colleagues Rue Bax, John Kobierowski, Eddie Chang and Doug Lazovick to represent the seller of the City Scape at Lakeshore transaction.
City Scape at Lakeshore is at 4630 S. Lakeshore Dr. and offers one-, two- and three-bedroom units ranging in size from 758 square feet to 1,261 square feet. Monthly rents for the 1990s multifamily property are between $819 and $1,254.
Shnitzer tells GlobeSt.com that Fairfield Residential is actively looking for value-add opportunities; especially in the Tempe area. "They've had a lot of experience in that submarket and in the southeast market in general," he adds. "They're definitely going full bore into the area." Occupancy at City Scape is 95% and Shnitzer says Fairfield will invest a significant amount in capital improvements.
Fairfield Residential is not the only investor returning to Phoenix as things pick up. Bascom Arizona Ventures, another firm very active in the Phoenix area multifamily sector during the mid-2000s is also a returnee after a five-year hiatus.
"This is a common theme these days," Shnitzer comments. "There's a lot of interest among investors and players here. We've turned the corner in Phoenix and investment groups have recognized that. They're bullish on the region."
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