MESA, AZ-Emma Capital of Toronto, operating under the entity name 2701 W. Broadway Road LP, acquired the 155-unit Broadway Village Apartments. The Canadian buyer paid a local TIC owner $6.8 million for the class B multifamily property.
"This was the seller's last property in Phoenix; they're slowly existing the market," comments John Kobierowski with ORION Multifamily Group in Scottsdale, AZ. Kobierowski, along with ORION's Alon Shnitzer, Rue Bax Eddie Chang and Doug Lazovick, represented the seller. Kobierowski, in fact, sold the property at 2701 W. Broadway Rd. to the TIC seller in 1999.
Kobierowski and Shnitzer tell GlobeSt.com that the 1980s property was widely marketed and attracted more than 10 offers. Emma Capital was familiar to the brokers, as they'd sold the 100-unit Sandpiper Apartments at 2735 E. Thomas Rd. in Phoenix to the entity in January, 2013. "They're looking for more in the area," Shnitzer comments. "They're a great buyer, a great performer, and everything was done perfectly on their end, both on the Broadway and Sandpiper transactions."
Shnitzer and Kobierowski point out that Canadian buyers have been increasingly interested in Phoenix-area multifamily properties for a variety of reasons, which include pricing and cost basis. "They like the market here," Kobierowski observes. "Things are less expensive – many times, they're in a restricted real estate market in Canada. We have higher yields here and they see upside in our market."
Kobierowski also notes that many of the buyers are sitting on piles of cash, thanks to energy. Furthermore, "this is the first time, in three cycles, that I've seen them stick around," he adds. "A lot of them are setting down roots and staying in this market."
Getting back to Broadway Village apartments, Shnitzer says Emma Capital plans upgrades to the 90%-occupied property. The pool area, common areas and units will be spiffed up. "Not too much has been done to it since John sold it to the partnership in 1999," Shnitzer says. "Their business plan calls for putting in approximately $3,500-$4,500 per unit for interior and exterior upgrades."
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