A Federal Way luxury apartment complex sold on Tuesday for $63.8 million, or a little over $159,000 per unit, which is the largest sale recorded so far this year, confirmed a source familiar with the transaction. Beverly Hills-based international real estate firm Kennedy Wilson sold The Reserve Apartments to San Diego-Based ConAm Group, a real estate management and investment company.
David Young and Corey Marx, managing directors for JLL’s Capital Markets Group, represented the seller in the transaction. Neither the buyer or seller were available for further comment.
Specifically with The Reserve, the seller did a tremendous job of proving the renovation potential at the property by improving a certain percentage of the units and achieving strong rent increases
The over 39-acre property, located at 125 SW Campus Drive, consists of 31 buildings and contains 401 luxury residential apartments. Built in 1989, the units are from one to three-bedrooms between 710 and 1,150 square feet in size and range from $1,048 to $2,324 a month. Some of the amenities include both indoor and outdoor pools, spas, an onsite business center, garages and a courtyard.
Marx says the fundamentals in the Federal Way market are very strong, as rents in the city rise residential tenants look for affordable alternatives that are close to work, amenities and services. “Specifically with The Reserve, the seller did a tremendous job of proving the renovation potential at the property by improving a certain percentage of the units and achieving strong rent increases,” Marx said.
“Demand is significant for renovated units in suburban markets, thus, the buyer can continue to improve the property going forward,” he added. “Certain investors are pursuing stronger yields and Federal Way is a market that presents that opportunity.”
