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JRK Property Holdings Pays $93 Mil for 300-Unit Multifamily Community in San Jose

8/28/23

JRK Property Holdings has acquired Duo Apartments, a 301-unit Class A multifamily community in San Jose, for $93.5 mil ($310k/unit). The purchase was financed with a loan for $62 mil.

Duo marks the third acquisition out of JRK Platform V, the Los Angeles-based real estate investment and management firm’s newest multifamily value-add fund which targets higher-quality, well-located multifamily investments built after 1990. The $1.0 bil fund which closed in October 2022 is 13% invested to date. The fund’s portfolio is comprised of institutional quality assets with an average year built of 2019 and geographic diversity between Florida, Kansas, and California.

JRK recently completed fundraising and is also currently investing out of its $200 mil MF Opportunities III, which targets value-add multifamily assets built before 1990. The investment vehicles are funded with capital from institutional investors, high-net worth individuals, and family offices. Through its current and predecessor funds, JRK owns and operates $7 bil in multifamily assets.

“The increasingly challenging credit environment and elevated interest rates have set the stage for imminent distressed sales despite strong underlying multifamily fundamentals,” said JRK President Daniel Lippman. “As well-capitalized buyers with predominantly long-term fixed rate financing on our existing portfolio, we are excited to have $1.1 bil of dry powder available to acquire high-quality real estate at incredible values as owners face equity shortfalls from cash-in refinances or otherwise capitulate to cap rate expansion.”

Built in 2021 by the seller, Duo is located at 6670 Emergent Way in one of San Jose’s largest mixed-use transit-oriented developments. Duo is served by Caltrain, trains, busses, and light rail, which provides residents with a wide variety of commuting options throughout the entire San Francisco Bay Area. Additionally, plans for substantial transit-oriented development near Diridon Caltrain station, will bring thousands of new jobs and residents to the area, creating additional demand for quality rental housing.

Duo offers a mix of single, one-, two-, and three-bedroom apartments housed in two, four-story residential buildings. Residents at Duo enjoy many high-end amenities including controlled access parking, a 24-hour state-of-the-art fitness center, arcade room with HD golf simulator, resort-style pool with cabanas, co-working spaces with private conference rooms, and outdoor grilling areas. The property is located a little over a mile from the Blossom Hill Caltrain station, which is only three stops from Downtown San Jose, providing abundant retail, dining, theater, art, and entertainment options.

Duo also benefits from San Jose’s strong employment base. Companies that call San Jose home include Adobe, Western Digital, Cisco, IBM, Samsung, eBay, and PayPal. In addition, the property is within walking distance to Kaiser Permanente San Jose, one of the City’s largest employers which has an employee base of more than 1,600.

Duo was 97% leased at closing.

The transaction was financed with a 10-year fixed rate loan from Freddie Mac, placed by Institutional Property Advisors, which also marketed the property for sale on behalf of the seller.






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