SAN FRANCISCO, CA - BRE Properties, Inc., a leading owner, operator and developer of high-quality apartment communities in targeted growth markets in California and Seattle, announced the acquisition of Jefferson at Hollywood for a purchase price of $120.5 million. The community of 270 apartment homes is located in the resurgent Hollywood sub-market of Los Angeles, California.
Built in 2010, the Class A community is in an irreplaceable, transit-oriented location in one of California’s most dynamic urban sub-markets, across from the Metro Red Line’s Highland subway station and one-half mile from the Hollywood Freeway (U.S. Route 101). The community has walking access to the neighborhood’s vibrant dining scene, top performing retailers, famous theatres and world-class Hollywood amenities. Recognized as the center of entertainment industry, the Hollywood sub-market has experienced a significant revitalization in recent years with an estimated $4 billion of public and private investment, resulting in increasing demand by employers in the entertainment and media industries for office and studio space.
The community was acquired on an unencumbered basis with proceeds from the Company’s revolving credit facility. In connection with the acquisition, the Company intends to dispose of several slower growth, non-core communities through a reverse like-kind exchange. The exchange is expected to be completed by the first quarter of 2014.
“This transaction is a component of our strategy to improve the Company’s portfolio quality by disposing of non-core communities and recycling capital into our high-barrier, in-fill development pipeline as well as select acquisitions such as Jefferson at Hollywood,” commented Constance B. Moore, President and Chief Executive Officer.
The Jefferson at Hollywood was acquired at a discount to replacement cost and is expected to generate a first-year net operating income-to-purchase price yield of 4.0%.
BRE Properties, based in San Francisco, California, focuses on the development, acquisition and management of apartment communities located primarily in the major metropolitan markets of Southern and Northern California and Seattle.