A pair of California real estate investment firms paid $74.25 million for The James, a recently built Downtown San Jose apartment building.
Beverly Hills-based Archway Equities and Larkspur-based Virtú Investments teamed up to buy the 190-unit, six-story complex from its developer, Fairfield Residential Company LLC, the firms said in a press release Wednesday. The pair paid roughly $390,800 a unit for the structure, which was built in 2019.
Virtú had taken a “multi-year” break from acquiring properties, Michael Green, a principal executive with the firm, said in the press release. It decided to get back into the market because of the opportunity The James, which is located at 98 N. First St. by St. James Park, presented, Green said. The property had an assessed value of $98.2 million, according to the county Assessor’s Office.
“We are excited to step off the sidelines for an opportunity to acquire a strong asset at a substantial discount to intrinsic value in a sound market with attractive supply and demand fundamentals,” Green, whose firm will manage The James post-sale, said in the news release.
The transaction comes as rising interest rates have made it more expensive to borrow money, which has started to weigh on real estate sales and prices.
Representatives of the parties reportedly involved in the deal did not immediately respond to requests for comment from the Business Journal. As of Tuesday, the transaction had not yet been recorded with the Santa Clara County Clerk-Recorders office.
The Mercury News first reported the deal earlier on Wednesday.
Berkadia Institutional Solutions marketed the complex for Fairfield, Archway and Virtú said in the release. Brian Eisendrath of Institutional Property Advisors arranged the financing for the deal, which was provided by Freddie Mac.
Eisendrath did not immediately respond to a request for comment.
San Diego-based Fairfield has a history of developing and offloading apartment complexes in the Bay Area. It sold the Duo Apartments in South San Jose for $93.5 million last month and a large Milpitas complex for nearly $154 million in April. In 2020, it sold a 315-unit complex near Diridon Station for $184 million to a Milwaukee-based group.
