Joint venture sells assets in Arizona for $ 313 million
A joint venture between Bascom Arizona Ventures and Pacific Life Insurance Co. has sold two luxury multi-family properties: Ascend in Kierland and Elite North Scottsdale. Located in the North Scottsdale, Arizona market, the properties total 724 units and were purchased by The Ezralow Co. for $ 312.5 million.
Tyler Anderson of CBRE, Sean Cunningham, Asher Gunter and Matt Pesch of Phoenix Multifamily Institutional Properties represented the seller.
Bryan Ezralow, CEO of The Ezralow Co., said in a prepared statement that the company has focused on multi-family properties in the Phoenix market for many years. He said the two properties gave the company the opportunity to gain immediate size in one of the metro’s wealthiest residential areas.
Ezralow said the acquisition is part of the company’s strategy to acquire 2,000 to 3,000 units in the Phoenix metro over the next 12 months. The company has approximately 30,000 units in the Bay Area, Los Angeles and Seattle, as well as more than 2 million square feet of retail, office, storage and industrial assets. Ezralow also has over 1 million square feet of properties under development.
The joint venture partners bought the properties, then known as The Legend at Kierland and The Tradition at Kierland, in a portfolio transaction in October 2017 from TIAA for $ 148 million. The Legend of Kierland with 360 units, renamed Elite North Scottsdale, sold for $ 73.4 million in 2017, and The Tradition in Kierland with 364 units, renamed Ascend at Kierland, sold for $ 74.6 million in 2017, according to data from Yardi Matrix.
Both properties were previously sold in June 2006 by European Investors as part of a larger portfolio deal totaling $ 408.4 million that included four additional multi-family assets, Yardi Matrix reported.
In November 2020, the two properties were the subject of two loans issued by AXA Equitable Life Insurance Co. which were due to mature in November 2022. The loan for Ascend in Kierland was $ 57.5 million and the loan for Elite North Scottsdale was $ 56.6 million. , Yardi Matrix reported.
Elite North Scottsdale, completed in 1996 and located at 6735 East Greenway Parkway on over 17 acres, was 95 percent occupied at the time of the sale. The property consists of one, two and three bedroom units ranging in size from 803 square feet to 1,397 square feet. Rents range from $ 1,660 to $ 2,595 and an average of $ 1,930.
Ascend in Kierland, completed in 1998 and located at 6633 East Greenway Parkway on over 18 acres, was 96.4 percent occupied at the time of purchase. It has one, two and three bedroom units ranging in size from 800 square feet to 1,411 square feet. Rents range from $ 1,769 to $ 2,680 and an average of $ 1,947, according to Yardi Matrix.
The properties are surrounded on three sides by the Westin Kierland Resort Golf Course. The interiors of the units feature luxurious finishes including quartz countertops, new cabinetry, kitchen backsplashes, undermount sinks, vinyl floors, ceiling fans, upgraded lighting, and plumbing fixtures. The living room and dining room have two-tone paint and new blinds and moldings.
Gunter said in prepared remarks that vendors have invested significant capital in uplifting communities with new and refreshed amenities and renovating about 75 percent of unit interiors. He added that the location on the golf course combined with the luxury amenities of the properties drives continued and strong demand.
Both properties have recently received state-of-the-art fitness centers with separate spin and yoga rooms, renovated pavilions, and heated pools. New amenities for Ascend in Kierland include a putting green, dog park and electric car charging station, while Elite in North Scottsdale received a new swimming pool, dog park and parcel locker system.
Mark Brotherton, senior portfolio manager for Bascom Arizona Ventures, said in a prepared statement that the joint venture is proud of the level of detail engaged in the repositioning of the two North Scottsdale assets. He said Bascom Arizona Ventures, a subsidiary of The Bascom Group, will continue to seek new opportunities in Phoenix and take advantage of the region’s growing multi-family fundamentals.
A CBRE study said Phoenix led the growth in rents for all U.S. subways in the second quarter of 2021, growing 15.3% year-over-year. Rent growth increased in the North Scottsdale submarket, exceeding the metro average with an increase of 16.9%.