Region Led Nation in Multifamily Sales for Past Two Years
A real estate investment firm landed a sizable loan to acquire a multifamily property in Los Angeles County, the nation’s most-populous county.
Silver Star Real Estate secured a $30.58 million loan to help it acquire the Amber Ridge Apartments, a 147-unit property at 2421 Foothill Blvd. in La Verne, a suburban city in the San Gabriel Valley, according to a statement from brokerage JLL, which secured the loan on behalf of the buyer. The loan is a 10-year, floating-rate loan that JLL secured through Freddie Mac.
Fairmont Management Co., a real estate management firm, sold the property to Silver Star for a total of $49.7 million for the property this month, according to CoStar. Silver Star, based in Anderson, South Carolina, made a cash down payment of $19.1 million, according to CoStar.
Though the coronavirus pandemic has slowed transactions, Los Angeles’ multifamily market has long been attractive to investors. Almost $11 billion in apartment trades closed in Los Angeles in both 2018 and 2019, which led the nation in apartment trades, according to CoStar.
“Virtually every corner of the metro was drawing interest before the outbreak, with trades ranging across the quality spectrum and throughout the county,” Steve Basham, managing analyst for CoStar in Los Angeles, wrote in his most recent report on the city’s apartment market.
And as a testament to the market’s resiliency amid the coronavirus pandemic, roughly $900 million in multifamily trades closed in the second quarter of 2020, according to CoStar research. That’s a far cry from earlier quarters, but still serves to illustrate the relatively strong demand for L.A. real estate.
In his report, Basham estimates that apartment pricing will fall around 15% to 20% in Los Angeles before bottoming out.
The Amber Ridge Apartments sold at a price near the city’s historic average, though. Silver Star paid $338,095 per unit, while the average apartment in Los Angeles trades for $341,000 per unit, according to CoStar research.
For the Record
JLL’s Greg Brown, Nicolas Lench and Charlie Vorsheck represented Silver Star. Holliday Fenoglio Fowler will service the loan.
Author Credit: Cara Smith-Tenta