Advanced Real Estate paid $234 million to acquire a 714-unit apartment complex in Costa Mesa.
For context, this single transaction exceeded the amount involved in all multifamily transactions in Orange County between January and August 2023, according to a report from Yardi Matrix. The sale was announced on December 28th.
Irvine-based Advanced purchased the complex at 2855 Pine Creek Drive from Houston-based Camden Property Trust. Publicly traded Camden owns and operates approximately 59,000 units in the United States.
Formerly known as Camden Martinique Apartments, the property was built in 1987. Advanced changes its name to Grand Costa Mesa. Advanced President Paul Julien said the company has budgeted $45 million to renovate the site. He expects the entire renovation project to be completed within four years.
This property’s floor plan includes one- and two-bedroom units. Monthly fees range from $2,000 to $2,800. Julian said the median rent in Orange County is $2,500. He added that Grand Costa Mesa is at 95 percent occupancy, with young professionals, families and students moving in.
“The opportunity to purchase such a large asset in coastal Orange County is rare. We look forward to continuing to grow our portfolio,” Julien said in a statement.
This acquisition expands Advanced’s portfolio to approximately 12,000 units.
The renovation work will be carried out by Advanced’s in-house company, R3 Construction.will be built
Resort-style pool and spa, expansive dog run and BBQ area. Units are equipped with washers and dryers and feature new cabinetry, flooring, and fixtures. Property management will be carried out in-house by the Advanced Management Company division.
The seller was represented by the JLL Capital Markets team led by Blake Rogers. Also, on behalf of Advanced, secured a $150.8 million Freddie Mac loan for him at a 10-year fixed rate of 5.95%. The debt advisory team was led by Kevin McKenzie and Greg Brown.
The $234 million purchase equates to about $328,000 per unit and provides momentum during what market intelligence group Yardi Matrix has defined as a period of slow multifamily growth in Orange County. From the beginning of the year through August 2023, only $216 million in multifamily assets were transacted in Orange County, according to a Yardi report published earlier this month.
The acquisition of Grand Costa Mesa marks Advanced’s third Southern California real estate transaction in 2023. In March, it purchased The Edison, a 12-story building at 100 Long Beach Boulevard in Long Beach, for $58 million. In September, it paid $96 million for the 264-unit Surf House Apartments at 7701 Warner Ave. in Huntington Beach.