Vancouver, WA -based Holland Partner Group has sold a portfolio of 11 apartment properties spread across 4 western states to Greenwich, CT -based Starwood Capital Group. The total sum for the properties was not disclosed, however 7 of the 11 properties are located in the state of Washington, and Starwood paid $173 million for those. Calls to Holland and Starwood were not answered.
The Seattle office of CBRE was the exclusive agent for Holland on the transaction. The people woking on the deal were Jon Hallgrimson, executive vice president, and Eli Hanacek, senior vice president.
The offering was marketed as a value-add portfolio that provided 2,139 units and average occupancy of 94 percent. The average vintage of the properties is 1990 with a geographic diversity across four western states of Washington, Oregon, Colorado and Arizona. Seven of the properties are in Washington (Vancouver, Everett and Lacey), one in Portland, Oregon, two in Colorado (Thornton and Denver) and one in Phoenix. The assets were part of the Holland Holdings IV Portfolio.
“[Holland Partner Group had] owned the portfolio for almost a decade, and it was time to move on. It’s a value-add portfolio, and it was a choice do they do the value add or take it to the market,” said Eli Hanacek, adding that he had found deep interest for the offering with a number of investors. “The interest was robust not only for the quality and value-add nature but also the geographic diversification of the portfolio,” he said.
Public documents offered the following prices paid for the communities. These figures are net of any personal property excluded in the sale, so they represent the taxable purchase prices:
Silver Oak in Vancouver, WA
8701 NE 54th Street
204 units sold for $35,150,552, or roughly $172,000 per unit
Larkspur Place in Vancouver, WA
7609 NE Vancouver Mall Drive
100 units sold for $18,092,624, or roughly $181,000 per unit
Sedona at Bridgecreek in Vancouver, WA
2220 NE Bridgecreek Avenue
200 units sold for $31,046,220, or roughly $155,000 per unit
Centerpointe Greens in Everett, WA
8600 18th Avenue W
186 units sold for $30,860,781, or roughly $166,000 per unit
Timberline Court in Everett, WA
1020 112th Street SW
126 units sold for $18,405,500, or roughly $146,000 per unit
Village at Union Mills in Lacey, WA
8146 Sweetbrier Lane SE
182 units sold for $25,688,603, or roughly $141,0000 per unit
Capitol City on the Course in Lacey, WA
5800 Titleist Lane SE
96 units sold for $13,750,000, or roughly $143,000 per unit
StoneRidge at Cornell is a 233-unit property located at 14800 NW Cornell Road, Portland, OR.
Covington Ridge is a 216-unit property located at 10571 Colorado Boulevard, Thornton, CO.
Sienna at Cherry Creek is a 220-unit development located at 1939 S Quebec Way, Denver, CO.
Fairways at Cave Creek is a 376-unit community located at 2140 W Thunderbird Road, Phoenix, AZ.
Based on the offering document, the properties received an interior update in 2008, which now represents and opportunity for Starwood to add improvements and create additional revenue growth in the overall portfolio. That growth was 7.6 percent in 2016, according to the document.
The offering describes the locations positioned well within their respective markets with high tech, manufacturing, service and medical jobs driving wage and rent growth.
This is not the first time Holland and Starwood have worked together on a transaction. In 2015, Starwood paid $93.1 million to acquire Holland’s 672 units in Denver at approximately $138,000 per unit. That same year, Starwood spent $47.1 million to acquire two garden-style apartment communities totaling 368 units in Milwaukie, Oregon.