March 14, 2019 – Newmark Knight Frank (NKF) announced that it has represented the seller in a $116,000,000 portfolio sale of seven apartment communities in six Bay Area cities. The properties are located in the cities of Napa, Vallejo, Hercules, Antioch, Dublin and Hayward. San Francisco based Reliant Group Management purchased the portfolio, which consists of 603 apartments totaling approximately 478,345 rentable square feet. The seller was an undisclosed private company.
NKF Senior Managing Director Richard Knutson, CCIM, Senior Managing Director Anthony Pappageorge, Managing Director Zach LeBeouf and Associate Director Will Thomas advised on the sale. Kathy Knutson served as leader of the support team.
According to Knutson, “Portfolio deals of this size and scope are historically complicated when they involve just two or three properties. However, when you are dealing with seven assets in four separate counties, it’s both extremely intricate and rare. Our team represented the seller under an exclusive listing agreement and initially procured ten purchase proposals.”
Reliant Group Management, one of the nation’s largest owners and operators of affordable housing, will convert four of the properties (369 units) to affordable housing, utilizing bonds and low income housing tax credits. It is estimated that Reliant Group Management will invest $40,000 per unit in upgrading these communities. Three of the properties (234 units) will continue to be maintained as work force housing and will also receive extensive interior and exterior renovations. Reliant has retained a significant number of personnel from the former owner, reducing employment dislocation.
Reliant Group Management President Joe Sherman noted, “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.” A robust level of social services will be provided by Rainbow Housing Assistance Corporation, a non-profit that serves over 100 low-income communities nationwide.