Cushman & Wakefield | Picor Multifamily Market Snapshot Q1 is reporting positive absorption and growth in all the important statistical categories for the Tucson multifamily market. Tucson apartments vacancy rates (averaging 8.5%) and average rents ($10.56 PSF) continue to see positive gains, while Tucson continues to generate significant investor interest due to low interest rates and high cap rates averaging 8% and more. To see the full Q1 2015 multifamily report CLICK HERE.

In the first week of May, nine transactions with an aggregate of 220 units totaling $5.88 million have been transacted with many brokers reporting ‘multiple offers’ being received and ‘high interest’ repeatedly for ‘value-add’ properties.

The following sales took place from April 30 to May 7^th scattered throughout most of the area submarkets.

EASTERN SUBMARKET
Investors from Burbank, California (Erlinda & Ameline Laking,members) purchased the Monterey Gardens Apartments at 1039 N Alamo Avenue in Tucson for $2 million ($37,736 per unit / $47 PSF) The 53 unit apartment community built in 1970, is located in the Wilmot Desert Estates. Large floor plans (20) 675-square-foot 1-bedroom units, (24) 950-square-feet 2-bedroom units and (8) 3-bedrooms. Recent capital improvements include exterior paint, landscaping, roof, resurfaced parking lot and new plumbing and power transformer installed. The majority of the units were recently remodeled. Amenities include a pool. David Walsh of Realty Executives Tucson Elite handled the transaction and should be reached at 520.591.1736 to learn more. Also see RED Comp #2861 for additional information.

CENTRAL SUBMARKET

Victoria Arms Apartments at 1518 E Hedrick Drive in Tucson sold to investors from Castle Rock, Colorado for $1.025 million ($40,800 per unit / $53 PSF). The single story, 25-unit complex, built 1975, has (24) 2-bedroom and one 1-bedroom apartment units. Amenities include individually fenced yards, a rental office on-site and lush landscaping. Mick Cluck, CCIM, with Coldwell Banker of Tucson represented the seller, Deep Water Investments of Reno, NV and said there was “high interest in the property from multiple buyers”. Cluck can be reached at 520.349.3533 to learn more. Jo Roberts with Long Realty in Tucson represented the investors in this 1031 exchange and should be contacted at 520.886.7500. Tucson Realty & Trust will be managing the property. Also see RED Comp #2874 for additional information.

DLGS JAK Properties of Phoenix (Pat Stoiak, manager) bought the Palo Verde Terrace Apartments at 3493 E Lind Road in Tucson for $750,000 ($14,423 per unit / $27 PSF) from Mental Health Resources. The 52-unit apartment complex was vacant and sold vacant with deferred maintenance. It was not on the market when sold. Allan Mendelsberg, Investment Specialist with Cushman & Wakefield | Picor handled the transaction and can be reached at 520.546.2721 to learn more. Also see RED Comp #2871 for additional information.

Local investor, Stak Properties (Kristi Verdugo) purchased the 14-unit multifamily complex at 2620 N Stone Avenue in Tucson for $317,500 ($22,607 per unit / $42 PSF). Built in 1948, the property has six 1-bedroom apartments, and 8 freestanding casitas and was fully leased when it sold. Chuck Corriere with Keller Williams in Tucson represented the sellers, Milton & Lorna Nunn of Washington, and can be reached at 520.400.9811 to learn more. Arthur Verdugo III with Tierra Antigua represented the investors and is at 520.544.2335. See also RED Comp #2857 for additional information.

WESTERN SUBMARKET

With seven multiple offers, Wildcat Equities of Tucson (Brandon Matheson,member) purchased Mountain Shadows Apartments at 3053 W Anklam Road in Tucson for $325,000 ($32,500 per unit / $51 PSF). A 10 unit complex, (7) 1-bedroom and (3) 2-bedroom units had the majority of the units upgraded with new kitchens and tile floors. Amenities included a swimming pool and laundry on property and each unit has spacious backyards and desert landscaping. Allan Mendelsberg, Investment Specialist with Cushman & Wakefield | Picor handled the transaction and can be reached at 520.546.2721 to learn more. See also RED Comp #2869 for additional information.

NORTHEAST SUBMARKET
An affiliate of Equity Partners of Tucson bought the Monte Vista Apartments at 4001 & 4015 E Monte Vista Drive in Tucson for $650,000 ($20,313 per unit / $46 PSF). Built in 1978, the (32) Jr. 1-bedroom units have A/C, mature landscaping, pool, picnic area and laundry facilities on-site. The property sold 85% occupied. Tony Reed with Long Realty represented the seller, Jarbun Properties of Irvine, CA (Dean Rathburn, officer) and should be contacted at 520.918.5189 to learn more. Sofonias Astatke with Equalibrium Realty represented the buyers in this 1031 exchange. Astatke can be reached at 520.250.8977. See also RED Comp #2872 for additional information.

Tucson investors, Eric Layton and Eli Halif purchased Alernon Way Apartments at 2457 N Alvernon Way in Tucson for $157,500 ($17,500 per unit / $30 PSF) in an Estate Sale. The property consists of a 9 unit apartment complex near Alvernon Way & Grant Road, built in 1950. At time of sale 8 units were rented and one was vacant. Peter Canacakos of Long Realty in Tucson handled the transaction for seller, The Londer Trust of Tucson. Canacakos should be reached at 520.918.4831 to learn more. Also see RED Comp #2876 for additional information on this transaction.

SOUTHERN SUBMARKET
Local investors (Gabriel Reina, member) purchased the Elvira Apartments at 320-326 E Elvira in Tucson for $230,000 ($17,692 per unit / $26 PSF) in a recent REO sale. The distressed property with thirteen units consisted mostly of two-bedrooms and sold with deferred maintenance. Allan Mendelsberg, Investment Specialist with Cushman & Wakefield | Picor represented the seller and Eddie Watters with Realty Executives Tucson Elite represented the investors. Mendelsberg can be reached at 520.546.2721 to learn more and Watters is at 520.877.4940. For additional information see RED Comp #2889.

Green Valley investors, Apero Properties (Mark & Kimberly Schmidt) bought the 12-unit multifamily complex at 351 and 401 W Apero Drive in Green Valley for $420,000 ($35,000 per unit / $49 PSF). The property consists of 12 apartment units, in four buildings built in 1966 and 1979. The seller was also from Green Valley, The Heinemann Family Trust ( Kenneth Heinemann, trustee). For additional information see RED Comp #2826.

Austin Texas-based Forestar Group Inc. (NYSE:FOR) purchased TLC Dove Mountain’s position in 88-finished lots at Boulder Bridge Pass in Dove Mountain for $6.1 million ($69,318 per lot) not the finished lot value. Miramonte Homes of Tucson retained builder option on the lots. This is Forestar’s second acquisition since March, when they bought 98-platted lots also at Boulder Bridge Pass II in Dove Mountain where they are also partnering with Miramonte Homes for vertical construction.

Boulder Bridge Pass is at the northwest corner of Dove Mountain Boulevard and Boulder Bridge Pass. The 88 lots average 10,022-square-feet and are on about 44.5 acres with open space.

Forestar operates in three business segments: real estate, oil and gas and other natural resources. At first quarter-end 2015, the real estate segment owned directly or through ventures over 112,000 acres of real estate located in 11 states and 14 markets in the U.S. The real estate segment has 11 real estate projects representing approximately 24,400 acres currently in the entitlement process, and 74 entitled, developed and under development projects in ten states and 13 markets encompassing over 11,200 acres, comprised of over 18,500 planned residential lots and approximately 2,000 commercial acres.

In the company’s May 6^th earnings call reported acquiring three future community sites in Q1 2015 for a total of $19 million and 600 potential future lots. In Q1 it sold 289 developed lots at $76,200 average price per lot, the highest quarterly average lot price and profit per lot reported since becoming a public company, compared to 974 lots in Q1 2014 at an average lot price of $42,600.

In its written statement, the company says, “We are well positioned to capitalize on housing through residential lot and tract sales and to deliver the greatest value from every acre by increasing lot margins. We anticipate residential lot sales in 2015 to be in the range of 1,800 – 1,900 lots, with average lot margins up over 2014. Our multifamily team continues to capitalize on stable supply and demand in our target markets through the development of high-quality multifamily communities. Construction is continuing on over 1,700 units in five projects.

Will White and John Carroll with Land Advisors Organization in Tucson represented TLC Dove Mountain LLC an affiliate of True Life Communities of Phoenix (Taber Anderson, manager).

To learn more White and Carroll can be reached at 520.514.7454. For additional information login to see RED Comp #2854.

[mepr-show rules=”58038″]Sale date: 4/29/2015. All cash purchase. Buyer purchased land banking position for Miramonte in this below market value deal.[/mepr-show]

Tucson Marketplace at the Bridges anchored by Costco and Walmart between Park and Campbell at I-10, will have a new Lin’s Grand Buffet, Starbucks and Verizon there soon.

Tucson Park Ave., LLC (Frank Lam, manager) purchased Pad #3, 2.48 acres, for construction of a 10,000-12,000-square-foot Lin’s Grand Buffet. The address at 3387 S Park Avenue, near Walmart, commanded a sale price of $1.4 million ($13 PSF).

Lin’s Grand Buffet & Mongolian Grill has already two successful locations in Phoenix, one in Yuma and more in Texas and California. Researching it on the internet make your mouth water. “Think of quality Chinese cuisine with excellent customer service, in a warm and inviting atmosphere,” that’s what Lin’s Grand Buffet says you can expect.

Kenny Lin was the young man who first introduced Lin’s Grand Buffet. He wanted to introduce a buffet style restaurant with a higher standard of food quality than what the current industry had to offer. With this desire, Kenny opened his first buffet restaurant in New York City in 1993 and has since opened 32 more restaurants throughout Texas and California. The company currently employs over 800 people.

Working with various partners, such as Frank Lam in Phoenix, who share the same goals and aspirations for excellence, Kenny Lin is growing Lin’s Grand Buffets throughout Arizona and other states.

Lin’s Grand Buffet at Tucson Marketplace is expected to be open Q4 2016.

Retail West Properties own Tucson Marketplace at the Bridges, that is being marketed by Randy Titzck and Chad Russell with Land Advisors Organization in Phoenix and continues to build out. Russell told us that ground breaking on an additional 8,000-square-foot out pad directly to the north of Costco should break ground in the next 30 days.

The south 1,900-square-feet end unit with drive-thru is pre-leased to Starbucks and the north 2,100-square-feet pre-leased to Verizon.

To learn more Titzck should be contacted at 480.874.4327 and Russell can be reached at 480.874.4339. For additional information login and see RED Comp #2852.