Boyd notes that Milpitas is a prime example of a market in Santa Clara County that is poised for economic growth, adding that technology sector job growth and a new BART station make this a fundamentally durable location for multifamily investments.

Boyd tells GlobeSt.com: “We are bullish on the Bay Area over the long term due to the depth and breadth of the employers. Quality housing options are lacking in the greater Bay Area and we are proud to provide it. Milpitas is one of those emerging submarkets on the cusp of being more connected to the East Bay and greater Santa Clara County. Meritage Apartments' proximity to job centers throughout the Bay Area, coupled with the development of mass transit options linking Milpitas to Fremont and San Jose, makes this a solid acquisition for our value-add multifamily portfolio. As investors with a long-term mindset, we view Milpitas as a thriving and resilient market.”

Julia Boyd Corso, co-president of IEC, notes that the strength of the market and the asset's value-add potential resulted in strong competition for this acquisition.

“There were a number of bidders for this asset,” explains Boyd Corso. “As the only discretionary capital, we were able to differentiate ourselves through surety of close. In addition, our familiarity with this market and product type enabled us to emerge as the right buyer.”

The property will be rebranded to 555 Apartments through an extensive rehab effort. Built in 1973, 555 Apartments will undergo a series of capital improvements as part of IEC's value-add investment strategy.

“We can substantially increase rents through operational improvements, rebranding and management efficiencies,” says Boyd Corso. “By revitalizing the property, we are improving quality of life for current residents and delivering a product that will attract renters throughout the Bay Area.”

Salvatore Saglimbeni, Stanford Jones and Philip Saglimbeni of Institutional Property Advisors, as well as Carlos Azucena of Marcus & Millichap brokered the transaction.

Steady gains in the US economy have resulted in net positives for the multifamily sector—will this wave continue for the foreseeable future? What's driving development and capital flows? Join us at RealShare Apartments on October 19 & 20 for impactful information from the leaders in the National multifamily space. Learn more.

MILPITAS, CA—The strength of the market, proximity to mass transit and a multifamily asset's value-add potential resulted in strong competition for a recent acquisition, formerly known as Meritage Apartments. Institutional fund manager Interstate Equities Corporation (IEC) acquired the 137-unit multifamily property for $46 million.

“Despite being net sellers, we have been actively acquiring assets that meet our investment criteria over the past few months, and this acquisition brings our total equity committed to roughly 15%,” says Marshall Boyd, co-president of IEC.

Boyd notes that this translates to an additional $600 million of buying power in this fund which will be deployed during the next several years. The asset was acquired through IEC Institutional Fund III LP, a fully discretionary, $200 million commingled fund that closed earlier this year.

“While we continue to expand our multifamily portfolio, we are also taking a selective approach to new acquisitions,” says Boyd. “Our investment strategy is to target un-renovated or partially renovated apartment communities consisting of 20 to 400 units, located in coastal infill markets that are demonstrating steady growth and are resilient to economic pressures. By adhering to this thesis, we are able to deliver attractive returns to our limited partners.”

Boyd notes that Milpitas is a prime example of a market in Santa Clara County that is poised for economic growth, adding that technology sector job growth and a new BART station make this a fundamentally durable location for multifamily investments.

Boyd tells GlobeSt.com: “We are bullish on the Bay Area over the long term due to the depth and breadth of the employers. Quality housing options are lacking in the greater Bay Area and we are proud to provide it. Milpitas is one of those emerging submarkets on the cusp of being more connected to the East Bay and greater Santa Clara County. Meritage Apartments' proximity to job centers throughout the Bay Area, coupled with the development of mass transit options linking Milpitas to Fremont and San Jose, makes this a solid acquisition for our value-add multifamily portfolio. As investors with a long-term mindset, we view Milpitas as a thriving and resilient market.”

Julia Boyd Corso, co-president of IEC, notes that the strength of the market and the asset's value-add potential resulted in strong competition for this acquisition.

“There were a number of bidders for this asset,” explains Boyd Corso. “As the only discretionary capital, we were able to differentiate ourselves through surety of close. In addition, our familiarity with this market and product type enabled us to emerge as the right buyer.”

The property will be rebranded to 555 Apartments through an extensive rehab effort. Built in 1973, 555 Apartments will undergo a series of capital improvements as part of IEC's value-add investment strategy.

“We can substantially increase rents through operational improvements, rebranding and management efficiencies,” says Boyd Corso. “By revitalizing the property, we are improving quality of life for current residents and delivering a product that will attract renters throughout the Bay Area.”

Salvatore Saglimbeni, Stanford Jones and Philip Saglimbeni of Institutional Property Advisors, as well as Carlos Azucena of Marcus & Millichap brokered the transaction.

Steady gains in the US economy have resulted in net positives for the multifamily sector—will this wave continue for the foreseeable future? What's driving development and capital flows? Join us at RealShare Apartments on October 19 & 20 for impactful information from the leaders in the National multifamily space. Learn more.