Waterford Property, CSCDA Buy Affordable Property for $280M

Waterford Property Company and the California Statewide Community Development Authority have partnered to acquire Residences at Westgate, a 480-unit affordable apartment community in Pasadena, for $280 million from Equity Residential. This is the fourth property in Waterford’s Pasadena affordable housing portfolio. It will serve as project administrator for the property.

Upon taking ownership, the partnership will immediately lower rents to rent to residents making 60% to 120% of the area median area income. In addition, Waterford and CSCDA will allocate 45% or 216 of the total units to be rented to tenants who make less than 80% of AMI. Another 96 units will be reserved for very low-income tenants making less than 50% of AMI. The average market rent is currently $3,241; however, ownership will reduce rents to $2,354 in the first year, a 37.65% discount to market.

This year, investors have shown increased interest in affordable housing opportunities, closing several notable transactions. In November, The Jonathan Rose Companies’ The Rose Affordable Housing Preservation Fund V acquired the Kings Villages Apartments in Pasadena for $223 million. The property includes 313 LIHTC and HUD-regulated Section 8 and Section 42 LIHTC units. The property features a mix of one-, two, three-, and four-bedroom floor plans spread over 58 buildings in a garden-style complex, as well as clubhouse, swimming pool, on-site laundry facility, two playgrounds, a basketball court, and leasing office.

Both Waterford Property Company and the California Statewide Community Development Authority have been active in the market. Waterford Property Company acquired Theo Pasadena from SummerHill Apartment Communities for $67 million in October. The 105-unit property is located between Old Town Pasadena and South Pasadena. The sales price equates to $638,095 per unit. The property features a central courtyard with a swimming pool, fitness center, cyber lounge and co-workspace, and rooftop dog park.

Also in October, Opportunity Housing Group and California Statewide Communities Development Authority partnered to acquire two apartment properties in Santa Rosa, California, for $183 million. The two communities serve a middle-income renter and were acquired under OHG’s workforce housing initiative.

Blake Rogers, Hunter Combs, Alexandra Caniglia, and Javier Rivera of Walker & Dunlop represented Waterford in the transaction.