Erzalow Co. has purchased a multifamily property in Agoura Hills, CA, previously known as Archstone Agoura Hills, from a private investor for $53 million. With 178 units, the property is the second largest multifamily property in the Agoura Hills market.
The sales team received 24 offers for the property and more than 250 registered buyers. “We got among the highest interest for this property of any property we have ever marketed. It appealed to the broadest variety of every investor type that we work with: private capital, sponsored capital and institutional capital, Between the size, which was large enough to appeal to institutions and small enough to be within reach for the larger private investors, and the age, being that it was built in the 1980s and basically un-renovated, which gave it plenty of untapped potential, it appealed to a tremendous variety of buyers.
The buyer was a private family office with headquarters very close to the subject, and they had an aggressive time period where they went non-contingent with a sizable deposit and were flexible on the closing date to meet the sellers other obligations.
The property was built in 1986 and is comprised of 11 two-story buildings on 15 acres with a mix of one-, two- and three-bedroom apartment homes. The property features a fitness and business center, a pool, spa, barbeque area and tennis courts as well as hiking trails.
The buyer will rebrand the property as Lexington Apartment Homes and plans to renovate the common areas and interior units to take advantage of rising rents in the submarket, a market condition that fueled interest in this property. Most of the properties that we are selling here are similar to this asset in that the newest leases being executed are as much as 8% to 10% higher than the leases for the same unit in the same condition 12 months earlier. You have outstanding rent growth in the absence of any capital improvement, so the thought on these 80s and 90s properties is that if someone were to roll up their sleeves and invest $10,000 per unit in upgrades, they could not only enjoy that 8% rent growth but and additional figure on top of that.