Sobrato Buys Complexes at Near-Record Prices

Trammell Crow Residential said Thursday that it sold two apartment complexes in the Southland for $126.8 million, transactions that underscore the strength of the region’s housing market.

Alexan City Place, a 214-unit complex in Pasadena, and Alexan Parc Rose, a 373-unit complex in Oxnard, were purchased by Sobrato Development Communities, which is branching out from Silicon Valley. Sobrato paid $56.5 million, or more than $264,000 a unit, for Alexan City Place, and $70.3 million, or nearly $188,000 a unit, for Alexan Parc Rose. The prices are believed to be near records for apartments away from the coast in Los Angeles and Ventura counties.

Low vacancies, combined with scant new construction, have kept rents rising across the Southland, boosting apartment building prices as well, said Stephen Stein, a regional manager for Marcus & Millichap in Los Angeles.

The deal marks Sobrato’s expansion into the Southern California market, where housing prices have risen at a robust pace.

Sobrato, the largest privately held developer of commercial and multifamily properties in Silicon Valley, owns more than 5,000 apartment units.

Trammell Crow sold the complexes to provide working capital for other apartment projects, said Kevin Andrade, a division partner in the Costa Mesa regional office.

Both Southland complexes, completed in June, have vacancy rates of about 10%. Although the vacancy rates are much higher than rates throughout the two counties, the rents are much higher as well, starting at $1,350 in Oxnard and $1,700 at the Pasadena complex.