By Jon Peterson
Beverly Hills, Calif.-based Kennedy Wilson has acquired the Belara at Lakeland apartment complex in Auburn for $81 million, or just over $188,000 per unit, at a 5.5 to 5.6 percent cap rate. “This return factors in the trailing 12 months of income that the property is producing. We feel good that this is our first apartment complex that we have acquired in Auburn,” says Shem Streeter, a managing director of Kennedy Wilson Multifamily Investments.
He sees that the apartment market in Auburn remains very tight. “Our occupancy in the asset we bought is 96.5 percent. This level of occupancy is where the occupancy is for the overall apartment market in Auburn. The reasons for this is that here are strong barriers of entry into this market. The rents being produced in Auburn don’t warrant the construction of new properties, and this has kept vacancy down,” said Streeter.
“The rents being produced in Auburn don’t warrant the construction of new properties, and this has kept vacancy down.”
Kennedy Wilson bought Belara at Lakeland from a joint venture between San Diego-based ColRich and New York City-based Ares Management. The property was first constructed in 2006. The listing agents on the sale were the Seattle and Portland offices of ARA. The Seattle person involved in the deal was Marty Leith, a director, and the Portland person was Gail Neuburg, an executive managing director.
Kennedy Wilson is planning to make some improvements to the common area amenities. This would include the fitness center and the leasing office. There also will be some work done on the inside and outside of the units.
Kennedy Wilson is planning on buying more apartment assets in the greater Seattle market. This would include buying more assets in Auburn as well as additional complexes in markets like Everett, Linwood, Bothell and Bellevue.
