Archway Equities, a Beverly Hills investment firm, paid $150 million for The Paseos at Montclair North, a 385-unit apartment complex in Montclair.
The seller was identified as 4914 Olive Street Properties LLC, which lists real estate developer Geoff Palmer of Beverly Hills as its primary manager-owner, according to PropertyShark.
Archway said the deal was its first multifamily acquisition in California. Much of its portfolio stretches across the South’s Sunbelt.
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“Somewhere along the way, cap rates between the Sunbelt and coastal markets inverted, and select pockets of Southern California should now provide more attractive risk-adjusted returns in the current environment,” said Sean Moghavem, Archway president.
The firm hailed the multifamily transaction as the largest in Southern California in 2023, citing CoStar data.
“With a lot of institutional capital sitting on the sidelines, there are very few firms that would be able to close on a transaction of this size,” said Sankeerth Pulusani, managing director at Archway. “Consequently, we believe that we were able to acquire the best asset in this submarket.”
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A report by YardiMatrix shows limited apartment growth in the Inland Empire is pushing up property values “considerably,” to an average price perunit of $337,276, with more than $4.5 billion in sales in the past 24 months.
The Inland Empire had just 404 new apartments come to market in 2022, an 81% decline from 2021 when 2,136 new units opened. The region has at least 4,737 apartment units under development now, YardiMatrix researcher shows.
The Paseos at 4914 Olive St. is a short drive to the 10 freeway and offers studio, one-, two- and three-bedroom “Santa Barbara-inspired” townhomes built around a park with a pool. Rent ranges from $1,930 to $3,040, according to its website.
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Amenities include two pool areas with spas and cabanas, a fitness facility with a children’s entertainment suite, yoga room, conference center and an entertainment lounge.
Archway said the property was 97% leased when the deal closed.
The units, nearly 10 years old, have not been significantly updated since the property was developed in 2014, Archway said. The firm plans to add “designer touches” to the apartments in what Pulusani describes as a “modest renovation.”
Source: Orange County Register
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