369 affordable-housing conversions coming from $116M San Francisco Bay Area apartment sale
Three North Bay apartment complexes were among seven with 603 units in the San Francisco Bay Area purchased by one of the nation’s largest operators of affordable housing with plans to convert hundreds of units to such dwellings.
The $116 million purchase by entities overseen by San Francisco-based Reliant Group Management includes 105-unit River Park Manor in Napa, 64-unit Strawberry Hill and 90-unit Holiday Gardens in Vallejo, 84-unit Willow Glen in Hercules, 112-unit Villa Medanos in Antioch, 68-unit Leisure Terrace in Hayward, and 80-unit Amador Valley in Dublin, according to brokers of the deal, which closed Feb. 13 and was announced March 14. That works out to an average price per unit of $192,371.
“Pricing metrics were consistent with recent market performance,” said Richard Knutson, a Newmark Knight Frank senior managing director and part of the team representing Reliant, in an email to the Journal.
The units were 95 percent occupied at the time of sale.
Reliant plans to convert the 369 units in River Park Manor, Willow Glen, Villa Medanos and Leisure Terrace to affordable housing, Knutson said. Levering bonds and low-income-housing tax credits, the company plans to spend nearly $15 million, or $40,000 a unit, on the conversions, according to the announcement.
The 234 units in the other three properties will remain priced as “workforce housing” but get extensive interior and exterior renovations.
“At a time when affordable housing is in extremely short supply in the Bay Area, we are able to preserve and protect hundreds of units of affordable housing with this portfolio purchase,” said Joe Sherman, president of Reliant, in the news release.
Providing social services at the properties will be Phoenix-based Rainbow Housing Assistance Corporation, a nonprofit that work with over 100 low-income communities nationwide.
The sellers of properties Reliant just bought were entities overseen by American Management Group Inc. of Orinda, according to public records. Reliant hired a “significant number of personnel from the former owner, reducing employment dislocation,” according to the announcement.
The Reliant Group started in 1992 acquiring hundreds of millions of dollars of loans from Resolution Trust Corporation and the Federal Deposit Insurance Corporation, according to its website. Since 2001, the company has focused on acquiring bond- and tax credit-financed affordable multifamily properties. It launches a capital accelerator program fund every 12 to 18 months and has acquired or invested in over 10,000 affordable and market-rate properties nationwide, including the recent deal.
Also part of the Newmark Knight Frank team advising Reliant on the deal were Managing Director Anthony Pappageorge, Managing Director Zach LeBeouf and Associate Director Will Thomas. Kathy Knutson led the support team.
Jeff Quackenbush covers wine, real estate and construction. Contact him at firstname.lastname@example.org or 707-521-4256.