Acacia Capital Targets Western Region for Multifamily Expansion

San Mateo-based Acacia Capital continues to execute its strategy of acquiring multifamily campuses in the Western US, building a portfolio of properties it owns and operates that now totals more than 30,000 units.

The firm’s latest deal involves the $62M purchase of the 124-unit Villa del Sol, a two-building complex in Sunnyvale, a transaction worth about $502K per unit.

The campus, located at 295, 355 and 395 East Evelyn Avenue, was sold by Palo Alto-based Pacific Urban Investors, according to a report in the Silicon Valley Business Journal. To finance the acquisition, Acacia secured at $32.5M loan from Fannie Mae through CBRE Multifamily Capital.

Villa del Sol, built in 2001, is in proximity to CityLine, an urban-retail village with apartments, offices, shops and restaurants. Each of the figure-eight shaped buildings at the complex contains an inner courtyard.

According to its website, Acacia is focusing on acquiring existing apartment communities involving 100+ units that are value add and core-plus opportunities in $20M+ transactions in target markets in California, Seattle, Phoenix, Portland, Salt Lake City and Las Vegas.

“As real estate and capital market conditions evolve, Acadia continues to develop investment platforms designed to capitalize on market inefficiencies and areas of illiquidity,” Acadia says in its marketing materials.

The Villa del Sol, which is located in one of most expensive housing markets in the US, boasts rents of more than $3,600 per month. Across the San Jose market rents are averaging about $2,885 per month, according to CoStar data.

Acacia has been on an acquisitions binge since late 2020, investing close to $750M to purchase apartment complexes in markets including Silicon Valley, Seattle and Phoenix. The firm’s multifamily portfolio now includes 45 properties.

Pacific Urban Investors has made a series of major apartment acquisitions in San Diego’s University Town Center submarket in recent months.

In July, the company acquired La Scala, a 354-unit community in La Jolla, which has been renamed Veranda La Jolla. Earlier this year, Pacific Urban Investors acquired the 400-unit La Jolla International Gardens, also in the UTC submarket, renaming the community as Allina La Jolla.

With the acquisition of Allina La Jolla, Pacific now owns and manages 21 communities in the San Diego market. Rory Gardner, president of Pacific, said in a statement that the company is actively looking for more investment opportunities across San Diego, including direct acquisitions or joint venture and preferred equity partnerships.