By Jon Peterson
Los Angeles-based Kennedy Wilson has placed on the market for sale the 451-unit LIV apartment complex in Bellevue located at 2170 Bel-Red Road. This property has a current value of $215 million, according to information provided by the property owner.
Kennedy Wilson had completed its business plan on the property and that is why it made the decision at this time to bring the property up for sale. “We have owned the property for five years. Our plan was to hold assets for three to five years for the Kennedy Wilson Real Estate Fund V, which is the investment fund we bought the property for,” says Shem Streeter senior managing director for Kennedy Wilson Multifamily.
The property owner has awarded the listing to the JLL Capital Markets Group out of its Seattle office. The two people working on the sale are Corey Marx and David Young, both managing directors. JLL declined to comment for this story other than to confirm that it will be marketing the asset for sale.
Kennedy Wilson had acquired the property as a brand new asset from Seattle-based Goodman Real Estate in 2016 for $172 million. The owner has tried to keep the property as new as possible over the years it has owned the complex. Some of this work has included building new front decks and planter boxes. The seller believes that there will be very minimal work needed on the property going forward.
Kennedy Wilson sees that the main investment play with the property in the future will be the ability to raise rents in the property. “[Bellevue] has seen a great deal of tech companies growing on the Eastside of the Seattle market. Some examples of this would be companies like Amazon, Microsoft and Facebook all of which would lead to increased demand and the chance to move rents upward,” said Streeter.
The sale of 2170 Bel-Red Road would be one of a limited number of large-scale assets to hit the market in suburban Bellevue. Most of the recent sales have tended to be in the downtown region or in other markets around Seattle.
One notable sale in Bellevue was the Borgata Apartments in Bellevue, which Seattle-based Urban Housing Ventures bought for $49.7 million in May of 2020. The 71-unit property located at 37 103rd Ave NE in Bellevue sold for roughly $700,000 per unit. The seller of the complex was Denver-based UDR, which owned the property since May of 2007. At that time, UDR paid $31 million for the complex.
Kennedy Wilson’s asset is essentially a fully-leased property with current occupancy at 95 percent, according to the company. The complex is offering 6 weeks of free rent, according to the building’s web site, and rents vary widely for its studio, one- and two-bedroom units. Based on Apartments.com, rent for studios ranges from $1,615 to $3,040, for one-bedroom units it goes from $1,668 to $3,933, and for a two-bedroom unit the rent is between $2,490 and $5,108.
Along with this divestment, Kennedy Wilson is continuing its search to find additional apartment assets to buy in the great Seattle market, and it will continue to be an active participant this the Puget Sound region.