This Morning's Multifamily Mavens
Our San Diego Multifamily Summit was this morning, and we had together two all-star panels to talk about how strong multifamily is. But how long will it last?
160 of you joined us at the Hilton San Diego Bayfront to find out how, and we'll have full coverage of the event (and the answer) next week. (Mom always said, leave 'em guessing.) In the meantime, we spoke ahead of time with some of our speakers to see what they're working on right now.
SVP/principal Jim Reynolds says OliverMcMillan is just getting started on the podium for a 206-unit development at the corner of Market and Park. The mixed-use project will be completed in about a year. In addition, the company is getting ready to start construction on Symphony, a 400-unit high-rise condo project in Honolulu (which is the perfect cover for a trip to Hawaii... business), and in December, a 260-unit apartment project is scheduled to get underway in Tempe, Ariz. The America's Cup veteran spent the summer in San Francisco where he headed a team in the inaugural Red Bull Youth America's Cup, a competition for young, talented sailors held in conjunction with the famed race. Jim's team, USA45 Racing--which includes son Jake--repped the US and sailed with champion Oracle Team boats.
Over the past couple of years, one of the most active buyers of Inland Empire multifamily properties has been San Diego-based MG Properties. President Mark Gleiberman told us about the company's most recent acquisition: the $42M purchase of Stoneridge Apartments in Upland. The seller completed interior renovations on 70% of the 300 units; MG plans to finish that work along with exterior improvements. Earlier this year, the company closed a $95M acquisition in Ontario, the 736-unit Terracina, where it plans to renovate one-third of the units to provide a couple of different price points. In addition, Mark--who spends much of his free time riding his road bike--says MG's going under contract on a deal in Denver--and looking for additional opportunities throughout SoCal and NorCal, as well as in Seattle and Portland.
Eagle Group Finance prez Brian Good tells us the company has been sourcing so many deals up north, that a month ago it opened a new office in San Francisco on Market Street. (Saves on gas.) The firm's pipeline is getting a lot fuller with multifamily deals. Although he comes from a retail background, he calls multifamily the most stable asset right now. Brian, his wife and their two girls spent the summer traveling to Sun River, Ore., as well as Martha's Vineyard and Cape Cod, but now it's back to work. Recently, Eagle closed on an acquisition loan for a high-end hotel development site in the heart of the retail corridor in Rancho Mirage.
Wood Partners SoCal development director Brian Hansen tells us the company has begun construction on its fourth LA County multifamily project: Alta South Bay, a 246-unit luxury apartment building situated between Torrance and Carson. The $55M community is slated to open in summer 2015. Pointing to a shortage of new luxury product in north San Diego County, Brian says Wood Partners entered the market at the right time with the right product. Need proof? The company's Alta San Marcos (above), a 108-unit gated community where rents top $2/SF, is nearly fully leased.
Allen Matkins partner Martin Togni, who moderated, tells us the firm's multifamily clients are buying existing product and investing in value-add improvements, and/or building smaller developments with resort-like amenities versus mega-complexes. Case in point: Alliance Residential's apartment project in Little Italy will boast some cool ground-floor retail tenants. Additionally, Martin says developers are buying busted condo projects that were converted to apartments, looking for that window downstream where they can reposition them back to condos. He repped Illumina on its UTC campus project, the biggest lease deal of its kind in San Diego. Fun fact: Martin's a dual US-Swiss citizen and grew up speaking a very old Swiss dialect. (When negotiations between landlords and tenants turn testy, he's able to keep the peace... we should put him in Congress.)