Advanced Real Estate has paid $234 million to acquire a 714-unit apartment complex in Costa Mesa.
For context, this single transaction eclipsed the money involved in all multifamily deals in Orange County between January and August 2023, according to a report from Yardi Matrix. The sale was announced Dec. 28.
Irvine-headquartered Advanced bought the complex, located at 2855 Pinecreek Drive, from Houston-based Camden Property Trust. The publicly traded Camden owns and operates about 59,000 units in the U.S.
The property, formerly called Camden Martinique Apartments, was built in 1987. Advanced will rename it The Grand Costa Mesa. The company budgeted $45 million to remodel the compound, said Paul Julian, Advanced’s president. He forecasts the entire remodel project would be complete in four years.
The compound’s floor plans include one- and two-bedroom units. Monthly prices range from $2,000 to $2,800. Julian said the median for Orange County rents was $2,500. He added that The Grand Costa Mesa is at 95 percent occupancy with a tenant mix of young professionals, families and students.
“It is rare to find an opportunity to buy such a large asset in coastal Orange County. We want to continue to grow the portfolio,” Julian said in a statement.
The purchase will expand Advanced’s portfolio to about 12,000 units.
The remodel will be constructed by Advanced’s in-house firm R3 Construction. It will build
resort-style pools and spas, an extensive dog park and barbecue areas. Units will feature washers and dryers, along with new cabinetry, flooring and fixtures. Property management will be handled in-house by the Advanced Management Company division.
A JLL Capital Markets team led by Blake Rogers represented the seller. It also represented Advanced to secure a $150.8 million Freddie Mac loan at a fixed interest rate of 5.95 percent for 10 years. The debt advisory team was led by Kevin Mackenzie and Greg Brown.
The $234 million purchase, which equates to nearly $328,000 per unit, brings momentum to what market intelligence group Yardi Matrix defined as a time of tepid growth for multifamily in Orange County. A Yardi report posted earlier this month said only $216 million in multifamily assets traded in Orange County from the start of the year through August 2023.
The acquisition of The Grand Costa Mesa is Advanced’s third Southern California property deal in 2023. In March, it bought The Edison, a 12-story building at 100 Long Beach Boulevard in Long Beach for $58 million. In September, it paid $96 million for the 264-unit Surf House Apartments, located at 7701 Warner Avenue in Huntington Beach.
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