One existing large apartment community and the site for another one have been sold in San Diego’s Mission Valley submarket for undisclosed amounts. Separate parties were involved for each sale.
Original developer The Padre Gardens Rancho Mission, LP has sold Bella Posta, a 344-unit apartment community in San Diego’s Mission Valley submarket, to Sares Regis Multifamily Value-Add Fund II, LP, free and clear of existing financing. HFF’s investment advisory ream represented the seller in the transaction, while its debt-placement team helped the borrower to secure floating-rate acquisition financing.
Bella Posta consists of four garden-style buildings comprising a mix of one- and two-bedroom units averaging 816 square feet. The 95 percent-occupied community is situated on approximately eight acres adjacent to the Interstate 15/8 interchange and SDCCU Stadium. The community is also a short distance from the Grantville Trolley Station, which provides easy access to San Diego’s major employment centers in the CBD, Fashion Valley, East County, and Kearny Mesa.
Community amenities include two swimming and spa areas, grilling area, locker rooms with saunas, fitness center, racquetball court, clubhouse, and a blend of private garages and underground parking.
The HFF investment advisory team representing the seller included senior director Hunter Combs and senior managing director Sean Deasy. HFF’s debt placement team representing the borrower consisted of executive managing director Kevin MacKenzie and senior director Brian Torp, along with senior managing director Timothy Wright.
“Market reception was robust for a multi-housing opportunity within the Mission Valley submarket, where institutional trades typically happen only once every decade,” Combs says. “The unique value-add opportunity from the original developer positions Bella Posta well for long-term growth.”
Additionally, local seller Guardian Capital has sold a site for The Heights at Fashion Valley, a 319-unit luxury residential development to be located at 6950,7020, and 7050 Friars Road, to Fairfield Residential. The complex will be situated on 5.43 acres directly across the street from Fashion Valley Mall. Currently, there are two three-story vacant office buildings on the property that will be demolished.
The Heights is within a 10-mile radius of 810,444 jobs, representing 56 percent of San Diego County’s total workforce. The Trolley light rail Green Line station is a short walk from the property and connects Mission Valley to Downtown San Diego. Nearby Interstates 8, 5, 15, and 805 provide immediate transportation linkage to Greater San Diego, Orange County, Los Angeles, and beyond.
Kevin Mulhern, Rachel Parsons, and Laurie Lustig-Bower of the CBRE Multifamily team represented the seller, while the buyer represented itself. “This fully entitled development site was a rare investment opportunity to build high-end residential in one of San Diego’s most dynamic infill markets,” says Parsons, first VP of CBRE in San Diego. “Mission Valley’s population is also forecasted to increase by 6.1 percent over the next four years. The Heights is poised to deliver multifamily units at an opportune time as San Diego is experiencing outstanding apartment investment fundaments with occupancy levels of 96.1 percent.”
Mission Valley has 5.5 million square feet of office space and 1.8 million square feet of industrial space, with major employers Booz Allen Hamilton, Inc., Wawanesa Insurance Company, and Aetna Inc.