An LA-based investor's apartment buying spree finally has it entering the San Diego mulitfamily fray.
Decron Properties just purchased Eaves Carlsbad, a 450-unit Class-B apartment community off El Camino Real and I-5. The firm paid $112M, or nearly $250k/unit, to Arlington-based Avalon Communities. While above the average per unit price for Class-B stock in San Diego, Decron's Daniel Nagel (here with president David Nagel golfing in Sun Valley, ID, recently) tells us there's still plenty of delta there for a value-add play.
The firm expects to pump more than $18M in renovations into the property, which will include larger bedrooms and kitchens with stainless steel appliances, quartz countertops and the usual accoutrements of higher-end apartments. Daniel says he hopes the updates will push the current average $1,500/month rents up by 20%, which still target middle class renters with incomes of $50k to $70k a year. The property also sits on 30 acres, giving Decron the ability to add more outdoor lounges with fire pits. Ultimately the property is being rebranded as The Reserve at Carlsbad.
And this may not be the only San Diego buy for the firm. Daniel says Decron—which already spent nearly $300M in SoCal apartment buys this year, including Broadstone at Strawberry Creek in Sacramento (here)—is on the hunt for more Class-B properties that are “well-located older communities that are in need of renovations.” They are focused on infill California markets with top-tier schools in the surrounding first ring communities of job center markets, he says. “There are a number of other SD markets that intrigue us, in particular the UTC area.”
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