Kidder Mathews Arranges $7 Million Sale of Multifamily Portfolio in Pasadena

[Updated] Commercial real estate firm Kidder Mathews has orchestrated the sale of three multifamily properties in Pasadena for a combined total of $7 million, the company said Thursday.

The transaction involves three separate apartment complexes located in desirable areas of Pasadena, each fetching a substantial price.

The largest of the three properties, a 12-unit complex at 174 North Mar Vista Avenue, sold for $2,674,000. A 10-unit building at 151 North Wilson Avenue commanded $2,200,000.

The smallest property in the portfolio, an 8-unit complex at 113 North Grand Oaks Avenue, rounded out the sale at $2,126,000.

Darin Beebower, Mark Ventre, and Arian Rejaei of Kidder Mathews represented both the seller and the buyers in all three transactions, said a statement by Kidder Matthews. 

The seller was identified as a family trust for Michael H. Saperstein, while the buyers were two separate entities.

OLCH Realty Investment, LLC acquired the properties on Grand Oaks Avenue and Mar Vista Avenue. A Lily Investment purchased the complex on North Wilson Avenue, the statement said.

According to Kidder Mathews, the sales achieved some of the lowest capitalization rates seen this year, coming close to pre-Measure H metrics. 

Measure H, a rent control ordinance passed in Pasadena last year, has presented challenges for real estate investors in the area. Despite these hurdles, the portfolio was marketed as a significant value-add opportunity, with potential for a 40% upside.

The properties’ locations just blocks away from Pasadena’s Playhouse District, Old Pasadena, and South Lake Street contributed to their attractiveness to investors. 

“The market is undoubtedly evolving, making it increasingly challenging to find buyers willing to invest in areas with strict rent control laws, as is the case with Pasadena as of late last year,” Arian Rejaei of Kidder Mathews said. “We found two great buyers with long hold horizons who saw these assets as an opportunity to own in great Pasadena neighborhoods and increase cash flow over time.”

Beebower said the recent passing of the family patriarch necessitated the sale. The heirs were faced with managing a significant real estate portfolio, a looming estate tax bill, and the transition from passive to active management, he said. 

“Our team assisted the sellers throughout this process: valuing each asset, identifying the best properties to sell, assembling a team of experts to assist in minimizing their tax burden, and ultimately completing the sale of three apartment buildings at premium market prices,” said Beebower. 

Kidder Mathews, with offices in California, Washington, Nevada and Idaho, said it averages over $10 billion in transaction volume, manages more than 55 million square feet of space, and conducts 2,600 appraisal, consulting, and cost segregation assignments annually,