Decron Properties Caps Record Setting Year with Sixth Acquisition in Phoenix For $76 Million
Los Angeles, CA (Jan. 4, 2022) — Decron Properties capped off the most active year in the firm’s 30-year history with its acquisition of BB Living at Eastmark, a 132-unit multifamily Build to Rent (BTR) community in Mesa, AZ for $76 million.
In 2021, the Los Angeles-based real estate investment firm acquired six assets for $570 million, far outpacing the company’s previous record of $345 million in acquisitions in 2018. The firm also disposed of another $413 million in assets during the year, producing transaction volume for the year of just under $1 billion.
With its acquisition of BB Living at Eastmark, Decron now has 1,482 units in the Phoenix MSA, all of them having been acquired in 2021. Having created an expansive footprint in Phoenix, Decron will use the same investment formula to recreate its success in other geographic markets as the firm continues to grow and diversify its portfolio outside of California, according to Decron CEO David Nagel.
“Our concerns about the current regulatory environment in California heightened our focus on investing outside of our home state in places like Arizona because of its more favorable regulatory environment and its robust population and job growth,” Nagel said. “As we look toward our next market, cities like Austin, Texas and Salt Lake City, Utah both meet those requirements as they represent lower cost markets with a lot of tech talent migration. It can be hard to break into a new market, but when you come with a reputation of successfully winning deals in other markets like we did in Seattle and Phoenix, we believe people will take us seriously. What we accomplished in Phoenix in a relatively short amount of time demonstrates we have the firepower needed to go into any market and win deals.”
The company’s next market needs to offer the kind of population, job and overall economic growth that made Phoenix attractive for apartment investment. Affordability is also a critical component and compared to Seattle, San Jose, and Los Angeles, the Sun Belt and Rocky Mountain job center cities, offer that as well said Nagel.
Built in 2020, the 132-unit community is located in the master planned community of Eastmark at 5150 Inspirian Parkway. BB Living at Eastmark features three- and four-bedroom townhomes with attached two-car garages. Home interiors offer high-level amenities such as stainless steel appliances, custom cabinetry, granite countertops, wood-style tile flooring, SmartRent Home systems and a washer and dryer. Community amenities include resort pool and splash pad, basketball court, and clubhouse.
The opportunity to expand into the BTR product is something Decron hopes to do in other Phoenix submarkets and other Sun Belt cities. There are currently only 4,400 BTR units in the entire Phoenix MSA and less than 30 percent of that product is 3-bedroom or 4-bedroom product. Further the average unit size at the former BB Living community, to be rebranded as the Reserve at Eastmark, is 1,862 giving this product a feel of a true single-family home with the additional benefit of nearby amenities such as a pool, spa, kids playground and outdoor social areas.
“Adding this BTR asset and potentially others to our portfolio enables us to provide additional housing options for individuals and families looking to rent a home with a larger floor plan,” Nagel said. “We will use the momentum of our record setting year to continue to propel our company forward as we seek ways to diversify and expand the Decron brand in new markets and varied asset types.”