Vista Apartment Property Sells for $41 Million
Deal Reflects Trend of Big Transactions Concentrated in San Diego’s Suburbs
The sale of the 154-unit Hidden Hills in Vista was among the latest of several recent big local apartment deals outside the city of San Diego. Photo: CBRE Group
Real estate investor The Apartment Co. has purchased a 154-unit multifamily property in the city of Vista, California, for $41 million, continuing a recent trend of big apartment deals in San Diego’s suburban markets.
The Encinitas, California-based buyer purchased the property, known as Hidden Hills at 311 Weston Circle, for $266,000 a unit from Los Angeles apartment investor TruAmerica Multifamily Inc. The property, built in 1985, was 94 percent occupied at the close of escrow, according to CoStar data.
TruAmerica bought the property as part of a 14-property multifamily portfolio for $482 million in 2015, CoStar reports.
Brokers at CBRE Group, which represented the seller, said the property includes a swimming pool, spa, barbecue grills and dog park, and the complex has a mix of one-, two- and three-bedroom units.
“The current ownership recently completed extensive updates to the unit interiors and common areas but there is still opportunity to continue the renovation program and further up the profile of this property,” said CBRE Senior Vice President Kevin Mulhern, adding the property received “extremely high” interest among potential buyers before the recent sale, based on its location and unit mix.
The Vista deal reflects a recent trend that saw many of San Diego County’s largest apartment property sales of 2018 take place outside of the city of San Diego, in suburban submarkets of North, South and East County.
A recent fourth-quarter report by brokerage firm Marcus & Millichap noted that local apartment property pricing below $200,000 per unit is still being found in cities of East and North County, where first-year investment returns above 5 percent remain achievable, especially for older, less-updated assets that remain in high demand and dominate overall apartment sales locally.
By comparison, similar properties in neighborhoods like San Diego’s Mission Valley, and others near the city’s Balboa Park, have recently been priced at higher than $300,000 per unit, while providing buyers with returns between 3 and 4 percent.
Marcus & Millichap’s researchers projected that limited acquisition opportunities in downtown San Diego, La Jolla and Carmel Valley will force prospective investors in coming months to look elsewhere in the county for properties built post-2000.