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7/13/16
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Raintree Partners has purchased eaves by Avalon, a 628-unit residential apartment community in Tustin, for $163.55 mil, a price that works out to over $260k/unit. The property, constructed in phases between 1968 and 1972, was sold by AvalonBay. We’re told the deal price represents the largest single asset, market rate res sale in Orange County for the last five years.
The property, situated in an affluent neighborhood bordering Irvine and Tustin Ranch, where the median priced single-family home is above $1.2 mil, is viewed as a value-add opportunity. It is located at 13921 Tustin East Dr, just off I-5 and close to Disneyland, South Coast Plaza and John Wayne Airport.
Property amenities include multiple pools and spas, two regulation tennis courts, a remodeled leasing office and fitness center, large clubhouse and more, situated on lots totaling over 26 acres. Apartment homes featured in-suite washer/dryers and many included a private garage or patio space.
Joe Leon and Dean Zander of Berkadia represented the seller, to whom they sold the building in 2010. This marks the third time in the past decade the team sold this community.
According to Leon, “eaves Tustin is the epitome of a value-add opportunity; with the planned interior upgrades the buyer will achieve a significant rent premium over the current rental rates, and still remain at rates below the newer competitive set nearby”.
Zander added “the immediate neighborhood is considered an affordable alternative to the Irvine market, and Tustin has enjoyed recent average market rent increases above 6% while still maintaining one of the lowest vacancy rates in Orange County at just 3.7%.” With high barriers to entry in the immediate area, the rents and occupancy rate are only expected to increase further as the market struggles to meet the housing needs of the expanding population.
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