Kennedy Wilson has sold a large multifamily property in Alameda for $231M — one of the largest multifamily transactions of the year in the Bay Area. The 615-unit Summer House underwent a $35M renovation, which included a reskinning of the exterior and the addition of a 4K SF clubhouse. Kennedy Wilson also sold a 75K SF office building in Dublin, Ireland, for $73M. The two sales are expected to generate a profit of $130M in Q4.

“These sales represent a significant step towards our capital recycling goals and ongoing efforts to upgrade the quality of our assets while creating more liquidity across KW’s portfolio,” Kennedy Wilson Chairman and CEO William J. McMorrow said.

At Summer House, the company increased net operating income by 109% over seven years during which the Bay Area was becoming one of the highest-growth job and real estate markets in the country, he said.

The proceeds from these two sales will be reinvested into four multifamily assets in the Pacific Northwest through a 1031 exchange. These assets have a combined 996 units. The company also will pay down unsecured debt under its revolving credit facility.

The company will reinvest funds into Latitude, a 210-unit apartment community in Happy Valley, Oregon, which it acquired in September, and Heatherwood, a 264-unit apartment complex in Gresham, Oregon, which it bought in October. It will also reinvest in two other properties with a total of 522 units in Greater Seattle and Portland that are expected to close before the end of the year.

“We are excited to now tap into that value and secure new opportunities in the Pacific Northwest, a region we believe still has a long runway for future growth,” McMorrow said.

The disposition of Summer House is the second significant apartment sale for Kennedy Wilson's multifamily group over the past several months. In July, the company sold Rock Creek Landing in Kent, Washington, for $109M and used the proceeds to fund the acquisition of 90 East, a 573K SF office campus in Issaquah, Washington. Within four months of taking ownership of 90 East, the Kennedy Wilson team negotiated a lease extension on 177K SF with Costco. The lease was extended an additional seven years beyond the existing term.