By Jon Peterson
Los Angeles-based Lowe Enterprises Investors has bought the 256-unit Deer Creek Apartments in Puyallup for $32.5 million or $126,000 per unit, according to sources familiar with the transaction. The property is located at 6115 111th Street East.
Lowe Enterprises declined to comment on what it paid for the property.
“We like the market in Puyallup as it fits in very well with one of our focused strategies for the greater Seattle market, which is to invest or develop workforce housing with apartments. The south country area of Seattle is much more conducive to this strategy than is downtown Seattle, which tends to be more expensive,” says Andy Sands, managing director for Lowe Enterprises and head of its multifamily activities.
He thinks that Puyallup has very strong demographics. “The area has seen strong job and population growth. There are some technology companies in the area, along with the port and the joint Base Lewis-McChord military base facility, which makes for a diverse and healthy economy,” said Sands.
The existing properties in that market are in high demand for renters, which makes them more valuable. “This area has a very tight apartment market. Vacancies in this region are in the range of 4 percent to five percent. One of the reasons for this is the lack of new construction of apartments that has been seen in the area for the past few years,” said Sands.
Lowe Enterprises acquired the property in Puyallup in a joint venture with Wheaton, Ill.-based First Capital Advisors. The seller of the property was JB Matteson, a San Mateo, Calif.-based real estate investment firm. It had acquired the property in 2012 $29 million, according to its Web site. This company declined to comment when contacted for this story. The listing agent on the sale was the Seattle office of JLL. The people involved in the sale were David Young, managing director, Corey Marx, executive vice president, and Seth Heikkila, senior vice president.
Deer Creek was built in 2000. The property was 95 percent occupied when the property was acquired. This property covers 18 acres and includes 21 buildings in a garden-style setting. Lowe Enterprises will be making some improvements to the property. It will be focused on the interiors of the units. The new owner hasn’t established a firm budget on the renovation work yet.
Lowe Enterprises owns a sizeable apartment portfolio in the greater Seattle market. This currently totals around 1,000 units. Much of its investment focus is with workforce housing. The investment company does own some units in the downtown area. One of these is its Luma project, which is now under construction. This is a 168-unit condo project located at 1321 Seneca Street in the First Hill neighborhood.