CORONA, CA—The Bascom Group LLC and certain funds managed by Oaktree Capital Management LP have structured a new venture to acquire $250 million in value-added multifamily properties throughout the US. The venture was launched with its first acquisition, the Springs Apartments, a 320-unit garden style community located at 650 Ebbcreek Dr. here in Corona, CA, which was purchased for $43.2 million.
Mark Jacobs, managing director at Oaktree says that his firm continues to see investment opportunities in the value-add multifamily sector.
Chad Sanderson, principal for Bascom, adds that the partnership, while seeking national, will “have a strong focus on acquiring properties throughout Southern California.”
Tom P. Moran, director in the California Office of Moran & Co., who represented the seller, tells GlobeSt.com that “The Springs offers a compelling interior and common area value-add opportunity for Bascom, particularly since the deal was acquired well below replacement costs. In addition, the acquisition is perfectly timed as the Inland Empire is in full recovery mode, showing strong job growth at 3.9%, which nearly doubled from 25,000 in 2012 to 47,000 jobs in 2013. With the market forecasted to add another 40,000 jobs by next year, and situated in a rebounding rental market, The Springs is well-positioned to achieve strong rent growth.”
Debt financing for the Springs deal was provided by OneWest Bank. It was sourced by Brian Eisendrath of CBRE. The property, just adjacent to Orange County, is surrounded by a robust employment base, and according to Sanderson, “As fundamentals in the region continue to strengthen, we believe the investment potential of the asset will continue to benefit.”
The Springs was built in 1987, and consists of 20 residential buildings on a sprawling 13.3 acre site located in West Corona, CA. The unit mix is comprised of 25% one-bedroom and 75% two-bedroom units with fully equipped kitchens and balconies or patios in all apartment homes. Common area amenities include two pool areas, fitness center, and a well-landscaped central courtyard with tot-lot and grilling stations.
Lee Nguyen, SVP of operations for Bascom explains, “We have seen a steady improvement in the Corona submarket over the past year. Both rents and occupancies have strengthened. Ultimately, we feel that the Springs is ideally positioned to benefit from a new ownership team that is ready to work hard to improve the tenant experience at the property.”
In April of this year, as GlobeSt.com previously reported, Bascom already started to grow its multifamily portfolio, acquiring Four Winds Apartments, a 138-unit apartment complex, for $13.4 million, the company’s second Southern California acquisition in two months. In February,the company purchased Huntington Villas Apartments, a rare 114-unit apartment complex in Huntington Beach, for $19 million.