Apartment sales in the greater Puget Sound region continue to outpace almost any other product type in recent week. This week, it is the San Francisco-based Jackson Square Properties that sold off one of its assets in Everett, the Arterra Apartments located at 711 West Casino Road, for $18.4 million, or $153,333 per unit, according to public records filed with Snohomish County. The buyer was San Diego, CA-based ColRich Multifamily, a company that operates over 11,000 units across seven western states. The sale closed on June 29, 2017. The seller was represented by Giovanni Napoli and Philip Assouad, both senior vice presidents with Kidder Mathews in Seattle.
Jackson Square had purchased the property in January of 2016 from Holland Partner Group for $13.35 million, or $111,250 per unit. Jackson Square Properties is a private real estate investment company located in the San Francisco Bay Area that specializes solely in the purchase and ownership of multifamily apartment communities. Founded in 2004 Jackson Square Properties has expanded over the years to own a diverse pool of multi-family assets totaling over 70 communities with 20,000 units in 9 states and a value over 3.8 billion dollars, according to its web site. In the state of Washington it owns eight other properties, four in Everett (excluding Arterra), two in Newcastle, and one each in Renton and Seattle.
Arterra is a community that features 120 one- and two-bedroom units. According to apartments.com, the rents in the property range from $1,085 – $1,095 for the one-bedroom apartments and from $1,335 – $1,415 for the two-bedroom units. There is no indication on the web site when these prices were updated. The complex was built in 1981.
Some of the amenities in the complex include a clubhouse, a 24-hour fitness center, a BBQ/picnic area and a dog park. The community is located in the southern part of Everett along Washing State Route 526, just south-east of its neighboring town of Mukilteo an in proximity to the Loganberry Lake Park.
ColRich Multifamily already owns three other properties in the state of Washington, according to its web site. All three are located in Tacoma, and they are the Vue25, Albers Mill Lofts and Chelsea Heights. The three properties have a total of 277 units. The company is a private, family-run, residential real estate development and investment firm that primarily invests in the value-add spectrum, with a heavy emphasis on value creation through either extensive renovations and repairs or ground up development, according to its web site. ColRich partners with a variety of financial institutions and high-net worth investors including CALPERs, Apollo, AREA, CS First Boston, Capmark, Harbert Capital Corporation, Loma Linda University Foundation and Morrison Street Capital Partners among others.
Public records indicate that the ColRich secured a $13.875 million acquisition loan for the property from CBRE Multifamily Capital, which represents 75 percent leverage on the asset.
Seattle-based Apartment Insights, an industry research organization that tracks apartment rental data in the region, tracks rents surging 4.6 percent in the second quarter of 2017 compared to the first quarter of 2017. Over the last year, that increase was at 7.6 percent. According to the report, the average rent across King and Snohomish counties for apartment properties over 50 units is $1,667, which is the first time average rents exceeded $2 per square foot; they’re at $2.01 per square foot. At the same time, vacancy has dropped from 4.66 percent in the first quarter to 4.22 percent in the second quarter, and landlord incentives have shrunk by half from an average of $13 per unit to about $7 per unit.
There are currently 23,572 units under construction, according to the repot. This is about the same as the first quarter of 2017 and 272 units more than a year ago. Fifty-eight percent of these are in the city of Seattle, 24 percent on the Eastside, 9 percent in south King county, and 9 percent in Snohomish county.
There are 11,660 units that have either been built or are under construction for completion in 2017, states the report.