Amid a once in a decade plus correction in the multifamily industry, Vanamor is seizing the opportunity to acquire distressed assets with the recent purchase of LuxLiv Apartments in Riverside, CA.
NEWPORT BEACH, Calif., Sept. 4, 2024 /PRNewswire-PRWeb/ -- Amid a once in a decade plus correction in the multifamily industry, Vanamor is seizing the opportunity to acquire distressed assets with the recent purchase of LuxLiv Apartments in Riverside, CA. This 62-unit, condo-built multifamily community marks the firm's second acquisition in the past eight months. Strategically located just off the 91 freeway, a key corridor connecting the Inland Empire, LuxLiv represents a prime investment opportunity in the supply-constrained Southern California market.
Key Acquisition Details:
- Purchase Price: $19,750,000 ($318,548 per unit | $232 per square foot)
- Discount to Replacement Cost: 35%+
- Cap Rate: 6.3% (T3 Income / Tax-Adjusted Expenses)
- Projected Stabilized Return on Cost: 6.9%
Vanamor plans to enhance LuxLiv Apartments through renovations, bedroom conversions, installation of solar panels, and other value-add strategies, positioning the property for strong future returns.
Brian Eisendrath and Cameron Chalfant of IPA arranged the financing for the acquisition. The seller was represented by Kyle Pinkalla with IPA. San Diego-based Sunrise Management will provide property management services.
In a market rife with distress, those who have remained patient and diligent over the past four years are now reaping the rewards. Aggressive buyers who utilized high-leverage, floating-rate loans fueled a speculative multifamily bubble in 2021 and 2022. The subsequent spike in interest rates has caused multifamily values to decline by 20 to 40 percent. With the majority of buyers during that period using loans with three-year maturities, many are now being forced to sell at deeply discounted values.
"Make no mistake, we're seeing significant distress in the market, with more likely to come; however, tremendous opportunities like LuxLiv Apartments are emerging. Our firm is prepared to capitalize on the capitulation we're witnessing today. When we look back five years from now, we'll likely recognize this period as the beginning of the next bull market," said Bobby Larsen, Founder and Principal of Vanamor.
Vanamor remains highly active in pursuing new opportunities across the United States, focusing on Class A/B, newer construction properties with strong cash flow and significant upside potential through value-add strategies. The company's strategy is grounded in conservatism, utilizing low to moderate (~65%) loan-to-value leverage on stabilized or near-stabilized properties. Vanamor partners with high-net-worth individuals, family offices, and middle-market-focused institutions. For more information, please visit www.vanamor.com.
Media Contact
Vanamor Investor Relations, Vanamor, 1 9497917228, [email protected], www.vanamor.com
SOURCE Vanamor
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