At a whopping price of $42 million, this month’s sale of the 129-unit Urban Village Apartments in Long Beach towers above other recent multifamily property sales in the area.
The luxury apartment complex at 1081 W. Long Beach Blvd., which opened in March, sold for more than $325,000 a unit.
By comparison, the average price of multifamily properties sold in downtown Long Beach within the past year is about $153,000 a unit, according to real estate information firm CoStar Group Inc.
Even the sellers – a joint venture between Irvine’s Urban Village Development Co. and Amcal of Agoura Hills – were surprised by the final closing price, said Keith Brennan, who brokered the deal.
“They got a price that potentially exceeded what they targeted,” said Brennan, who represented both the buyer and seller. “They expected to get about $35 million.”
But at the same time, Brennan said the buyer – JB Matteson Inc. of San Mateo – was willing to pay top dollar after it became clear that interest from tenants was strong.
While downtown Long Beach continues to soar in popularity, the Urban Village complex is about a mile north of where much of the activity is.
“It was one of these projects where it was unknown how quickly it would get leased up,” Brennan said. “But when it finally hit 90 percent leasing, that’s when the buyer got serious.”
The complex has nearly 97,000 square feet of apartments, plus an additional 4,800 square feet for retail. The property also includes a pool, spa, fitness center and clubhouse.
On average, tenants pay slightly more than $2,000 a month, according to CoStar. Tenants living in downtown Long Beach as a whole, however, pay $1,300 a month on average.
John Bellack, chief investment officer at JB Matteson, didn’t respond to a request for comment about the sale, but he praised the deal in a press release.
“The acquisition of Urban Village Apartments fits well within JB Matteson’s investment strategy to acquire newer Class-A multifamily projects located in major cities on the West Coast,” Bellack said in the statement. “Urban Village’s location in an urban setting within walking distance of jobs, services, amenities and mass transportation appeals to the growing renter demographic.”
Coming Clean
Real estate executive Scott Lyle doesn’t like to follow the pack.
So when he was asked to deliver a corporate speech he balked at the idea of giving an ordinary PowerPoint presentation.
Instead he walked out on stage at his company’s headquarters in Norwalk, Conn., with a vacuum cleaner strapped to his back.
That memorable moment came in 2009 when the real estate portfolio Lyle managed was owned by GE Capital. That portfolio, he said, had eliminated $16 million in operating expenses that year so Lyle was asked to give a presentation about productivity to GE Capital’s board.
“I was trying to create something that was visual,” he said. “We had just made a deal with Hepavac. That’s the vacuum you have to strap on your back.”
The Hepavac, Lyle explained, made his janitorial staff much more mobile and helped provide a deeper clean in less time.
“It’s really a productivity tool because you could reduce hourly cost,” he said. “So I decided to strap this vacuum on and walk into this GE Capital boardroom and start talking about innovation.”
It took some board members a bit longer than others to realize the metaphor Lyle was attempting to use but, luckily, he said everyone loved his presentation.
“By the end of the discussion, people were getting up and trying it on,” he said.
Despite the successful outcome of his presentation, Lyle, who just joined West L.A.’s Palisades Capital Realty Advisors this month as principal and chief operating officer, said he’s not so against PowerPoints anymore.
Done Deal
Affordable housing developer West Hollywood Community Housing Corp. plans to build a $65 million apartment complex dedicated to senior and low-income family housing.
The plans, announced last week, come on the heels of the group’s $9.5 million purchase of a 1.76-acre property at the southeast corner of Pico Boulevard and Westmoreland Avenue near L.A.’s Koreatown.
Only a 12,000-square-foot building, which was used as a day care center, and a massive parking lot sit on the land, said Yoav Sarraf, managing director of Beverly Hills’ Concord Real Estate Services, which brokered the sale.
Those will be demolished, he said, and replaced with a 186-unit affordable housing development.
Construction is slated to begin next year on the project’s first phase – a six-story, 94,500-square-foot midrise tower – and is expected to be complete by fall 2018. The remaining 93 units will be built in an adjacent seven-story tower.
“This will only further bolster the area,” Sarraf said. “It’s really amazing to see the city growing at such a rapid pace.”
Staff reporter Cale Ottens can be reached at [email protected] or (323) 549-5225, ext. 221.
