OliverMcMillan sells 3 apartment properties
July 8, 2013
OliverMcMillan sells 3 apartment properties
The Daily Transcript

By Thor Kamban Biberman

The OliverMcMillan Co. has sold three of its prime downtown San Diego apartment properties, totaling 459 units, for about $141.8 million in cash and assumed liens.

The properties, known as The Lofts Portfolio, include the 207-unit Lofts at 707 10th Avenue, the 106-unit Lofts at 655 Sixth Avenue, and the 146-unit Lofts at 677 Seventh Avenue.

About 23,000 square feet of ground-floor retail space are a part of these properties and the sale as well.

The recorded buyers are The Lofts at 655 Apartment Holdings LLC, The Lofts at 677 Apartment Holdings LLC and The Lofts at 707 Apartment Holdings LLC, respectively ? with the Commingled Pension Trust Fund of J.P. Morgan Chase Bank (NYSE: JPM) as its sole member.

Kevin Mulhern, Rachel Parsons and Dixie Hall, of CBRE (NYSE: CBG), arranged the sale on behalf the seller, OliverMcMillanFoster LLC. The buyer represented itself.

The Principal Real Estate Investors LLC was the lender. Riverstone Residential Group, of Dallas, will continue to manage the properties.

The Lofts at 707 10th were sold for $64.86 million. The buyer took out a $28 million loan to purchase the property.

The 10th Avenue property features studio, one- and two-bedroom floor plans, and live/work lofts.
A fire pit in a central courtyard, a private theater, a business center and granite countertops are part of the package.

About 9,000 square feet of ground floor retail space is at the base of that development.

Russell Valone, Marketpointe Realty Advisors president, said 16 units were vacant at 707 10th at the time of his survey last March. The rents ranged from $1,050 to $2,562 as of last spring.

The Lofts at 655 Sixth at G Street at the edge of the Gaslamp Quarter were purchased for $10.89 million. The buyer assumed a $24.25 million construction loan with a $23.46 million remaining balance at the time of the sale.

The studio- to three-bedroom units range from 546 to 1,546 square feet according to The CoStar Group. (NYSE: CSGP).

Valone said there was just one apartment was available at 655 Sixth at the time of MarketPointe?s spring survey. The apartments there rented from $1,450 to $3,850 per month.

Features at the Sixth Avenue property include a ?Manhattan-style lobby,? an outdoor patio and lounge, deck areas for socializing, and a media center.

An Ace Hardware ? the only hardware store remaining in downtown San Diego ? and a gourmet burger restaurant occupy the ground floor retail.

The Lofts at 677 Seventh were sold for $21.26 million plus the assumption of a $26.6 million note with $21.32 million remaining at the time of the sale.

Amenities at the Seventh Avenue property include a fitness center, granite countertops, picnic and grill area among other features.

Valone said the 677 Seventh rents ranged from $1,535 to $3,000 in March. The floor plans feature studio- to two-bedroom units.

The ground floor retail at 677 Seventh includes the gastropub Neighborhood and Zanzibar Caf?.

The Lofts at 677 Seventh were sold for $21.26 million plus the assumption of a $26.6 million note with $21.32 million remaining at the time of the sale.

The Loft Portfolio complexes were constructed between 2006 and 2010. Valone said the properties were originally constructed as apartments rather than condominiums, like so many others at the time.
Property manager Riverstone, a subsidiary of Dallas-based CAS Partners Inc., bills itself as the nation?s largest third party multifamily manager.

Riverstone lists eight local apartment properties in its management portfolio in San Diego County.
Along with the Lofts Portfolio, they include Rolling Hills Apartments in Chula Vista, the Avion at Spectrum in Kearny Mesa, Circa 37 apartments at the northern edge of Mission Valley, Alta San Marcos, and the BluWater Crossing Apartments in Carlsbad.

OliverMcMillan, which declined comment for this story, has been more than a little bit busy lately, though much of its business has been away from its home turf.

In downtown San Diego the developer ? who may be best known for the Uptown District and Village Hillcrest ? is building another property known as The Lofts at 688 13th Street. That 208-unit apartment property is slated for completion by mid-2015.

Out of the area, OliverMcMillan has been a leader in the redevelopment of Atlanta?s Buckhead neighborhood with new retail and residential development in the works, as well as the transformation of the 129-acre Riverfront District in Everett, Wash., planned for more than 1 million square feet of commercial and residential space at buildout.

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