Sunday, February 24, 2019

Trion Properties Sells 97-Unit Multifamily Community in San Diego, CA for $17.9 Million


Willow Glen Apartments, 3635 College Avenue, San Diego, CA
  
SAN DIEGO, CA – Trion Properties, a private equity real estate firm that specializes in multifamily investments, has sold Willow Glen Apartments, a 97-unit multifamily community located in the rapidly growing Rolando/College Area submarket of San Diego, California, for $17.9 million. 

Trion purchased the property in June 2015 for $9.6 million. After implementing $2.2 million in capital improvements and rebranding the community, the firm nearly doubled the asset’s value and tripled the net operating income within the first 18 months of ownership, according to Max Sharkansky, Managing Partner of Trion Properties.

Max Sharkansky

“When we acquired this asset less than four years ago, we recognized the opportunity to drive significant value through strategic renovations and upgrades, as well as improve operational efficiencies through our vertically-integrated property management platform,” explains Sharkansky

Through repositioning, hands-on management, and aggressive lease-ups, we transformed Willow Glen into a strong, cash-flowing asset, successfully stabilizing the property and increasing the occupancy to 97 percent. 

"This has ultimately allowed us to achieve a 37.23 percent return to our investors.”

Sharkansky notes that the property was acquired in one of the lowest price-per-unit multifamily sales in San Diego in 2015, allowing Trion to invest more equity in its redevelopment, which also included improving the overall design of the community.

Mitch Paskover
Renovations completed by the firm include the installation of quartz countertops, stainless-steel appliances, and new cabinetry in each of the units.

 Exterior upgrades include a complete revamping of the fa├žade with new paint, as well as the integration of low-water and drought-tolerant landscaping to minimize operating costs and improve the sustainability of the property.

According to Sharkansky, Trion recognized that San Diego State University students would be a large prospective resident demographic, due to the community’s close proximity to the school. 

"With this in mind, the firm contracted bulk high-speed Internet and offered free Wi-Fi, which proved to be highly popular and boosted leasing.

The principals of Trion Properties are Max Sharkansky and Mitch Paskover, two real estate professionals with over 30 years of combined experience in finance, acquisitions, management and redevelopment.

Corey McHenry
The Rolando/College Area of San Diego offers extremely tight multifamily vacancy of 1.3% and lower rents than nearby comparables. The submarket also boasts numerous schools, community parks, and retail amenities.

Willow Glen Apartments also offered the buyer, Bernard Xavier, with a rare opportunity to purchase a well-maintained 97-unit property in a market with such strong demand, Sharkansky notes.

“As San Diego as a whole and the College Area submarket in particular continues to generate increasing multifamily demand and investor interest, we strategically determined that now was the right time for us to sell this asset,” continues Sharkansky. 

The property presents the buyer with additional value-add opportunity and continued runway for growth.”

Peter Scepanovic
The asset, situated in a primarily single-family-home residential community, provides convenient access to Interstate 94, Interstate 8, and employment centers throughout San Diego.

Peter Scepanovic and Corey McHenry of Colliers International represented Trion Properties as the seller in this transaction.

Founded in 2005 and headquartered in Los Angeles, Trion Properties is a private equity real estate firm that invests in value-add multifamily throughout the west coast. 

Trion has completed more than $300 million in transactions, with a portfolio of over $315 million in assets, generating an average internal rate of return in excess of 30 percent. 

Willow Glen Apartments Interior
With its fully built-out operator platform, Trion has repositioned and stabilized undervalued assets, leveraging its expertise in real estate finance and renovation of multifamily properties to drive returns for its investors.

Since its inception, Trion has acquired the fee interest—or in certain instances the debt secured by the fee interest—of over 2,450 multifamily units. To date, Trion has successfully repositioned and resold over 1,150 units and over 180,000 square feet of commercial real estate space.

Additional information is available at http://www.trion-properties.com/

CONTACTS:

 Micaela Fehrenbach / Elisabeth Manville
Brower Group, Inc.
(949) 955-7940


BKM Capital Partners Acquires 203,231-SF Multi-Tenant Industrial Property in Denver, CO for $24.3 Million


Valley Business Center, 700 West Mississippi Avenue
 Denver, CO
  
            DENVER, CO BKM Capital Partners, an institutional fund manager with a niche focus on value-add, multi-tenant light industrial investments, has acquired Valley Business Center, a 203,231 square-foot, five-building multi-tenant light industrial property in Denver, Colorado. The industrial complex was acquired for $24.3 million.

            “The central Denver industrial submarket has consistently outperformed many of Denver’s other major submarkets with historically low vacancy rates and high demand,” says Brian Malliet, CEO and Co-Founder of BKM Capital Partners.

Brian Malliett
 “In fact, the industrial vacancy rate in central Denver is 3.6 percent, which is well below the metro average of 6.1 percent. The property is also strategically positioned between downtown Denver, Cherry Creek and the Denver Tech Center, the largest office submarkets in the city with projected employment rates in the metro region set to increase by 26-percent by 2023.”

Malliet explains this asset will benefit from this ongoing growth in the region and that this acquisition is consistent with the firm’s strategy to acquire large-scale multi-tenant industrial properties in high-growth markets where it can amass economies of scale and drive returns for investors through its comprehensive value creation strategy.
             
Brett Turner
“We target best-in-class markets where we have a growing presence and assets that are aligned with our niche approach and core investment thesis to enhance value through strategic improvements, leasing, and integrated hands-on management,” says Malliet.

 “We acquired Inverness Business Park, a 215,268 square-foot, eight-building multi-tenant industrial asset in Denver last year. The addition of Valley Business Center will expand our portfolio as we continue to seek out opportunities in the region and allow us to immediately drive down operating costs.”

Murray Platt
Constructed in 1983, Valley Business Center is an institutional-grade asset that features top of the line industrial features such as concrete tilt-up wall construction, 16-20’ clear heights and ESFR sprinkler systems. However, it lacks key cosmetic upgrades and modernization, according to Brett Turner, Managing Director of Acquisitions at BKM Capital Partners.

“Because of this, we were able to acquire the asset below replacement cost and plan to implement a series of upgrades to the property, which include modernizing the building facades with a multi-tone paint scheme and upgraded materials, uniform landscaping, and revamped project standard signage and addressing, among others,” says Turner.

 “These strategic upgrades will allow us to increase the long-term value of the asset.”

Valley Business Center is currently 100 percent occupied and features 20 different tenants including FedEx Kinkos, Colorado Lottery, Black & Decker and Municipal Energy Systems to name a few. 

Doug Viseur
“The strong in-place occupancy at the property provides immediate stabilized cash flow and the diversification of tenants limits rollover exposure from any one single tenant,” explains Turner. 

 “The staggered rent rolls also allow us to capitalize on ongoing rent appreciation over the next few years as the Denver market continues to mature and the lack of available land for new development continues to drive demand to the property.”

            BKM Capital Partners acquired Valley Business Center from Mountain West Industrial Properties.

Murray Platt, Doug Viseur, and Daniel Close at CBRE represented the seller in the transaction. BKM represented itself.

The property is located at 700 West Mississippi Avenue in Denver, Colorado near a strong network of surrounding highways including Highway 85 and Denver’s main artery, Interstate 25.

Daniel Close
BKM Capital Partners, currently raising their second institutional fund, was founded in 2013 by Brian Malliet and Nima Taghavi. 

Headquartered in Newport Beach, California, BKM Capital Partners is a fund manager specializing in the acquisition and improvement of value-add multi-tenant industrial properties in metro areas across the Western U.S. 

Combining a deep knowledge of this niche industrial product type with an operator platform that includes in-house capabilities including on-site property management, asset management, and construction management, the firm continues to build on its proven track record, generating strong results with high levels of transparency and engagement for investors. 

Additional information is available at www.bkmcapitalpartners.com



CONTACTS:

 Alex Caswell/Lexi Astfalk
Brower Group
(949) 955-7940