Essex Property Trust Seals $505M Deal for Majority Stake in Four Prime Apartment Properties

Essex Property Trust Inc., based in San Mateo, California, has recently finalized the acquisition of the remaining 49.9 percent stake in a portfolio of four apartment properties. The portfolio comprises 1,480 units located in Washington and California, with a transaction value of $505 million, translating to approximately $341,216 per unit.

Acquisition Details and Financial Metrics

The acquisition involved acquiring the stake from AEW Capital Management. Essex Property Trust disclosed that the purchase price led to a 5.25 percent capitalization rate. Additionally, they reported an internal rate of return (IRR) of 11.4 percent generated by the portfolio.

Previous Ventures and Property Portfolio

The partnership between Essex Property Trust and AEW Capital Management originally acquired these properties in 2014 as part of a larger portfolio. The remaining properties in the portfolio include Havens, Parkside Court, Esplanade, and Bothell Ridge, featuring a total of 1,480 units. Notably, three of these properties were constructed in the 1980s, while Havens dates back to 1969.

Property Details

The four properties are geographically dispersed across California and Washington. Havens, located at 10349 Slater Ave. in Fountain Valley, California, consists of 440 units. Parkside Court, situated at 4200 West 1st St. in Santa Ana, California, offers 210 units. Esplanade, located at 10201 Camino Ruiz in San Diego, boasts 616 units. Lastly, Bothell Ridge, at 19928 Bothell Everett Highway SE in Bothell, Washington, comprises 214 units.

Debt Repayment

As part of the transaction, Essex Property Trust repaid $219.9 million of debt associated with the portfolio, indicating a strategic financial maneuver as a result of the acquisition.