Sack Capital Partners, a San Francisco-based investment firm, has acquired the Fourth & U Apartments in Berkeley for $52.3 million. The purchase was reported by the San Francisco Business Times, which noted that the previous owner was an affiliate of Essex Property Trust. Attempts to reach Essex Property Trust for comment were unsuccessful.
The property, located at 2020 Fourth Street, consists of 171 units in a five-story building and includes 15,000 square feet of retail space across eight suites. The sale price equates to approximately $305,847 per apartment unit.
According to the San Francisco Business Times, Sack Capital plans both interior and exterior renovations for the property and will introduce on-site property management and leasing services. Jeff Smith, managing partner with Sack Capital, said the company aims to “address the affordability gap between renting and owning” in Berkeley.
Originally built as condominiums in 2010, Fourth & U Apartments primarily offers one-bedroom units with some two-bedroom options. The building is situated just south of Berkeley’s Fourth Street retail corridor.
This acquisition marks Sack Capital’s third major deal in recent weeks. Earlier this month, the firm purchased Fountain Park apartments in San Jose—164 units—for $52 million. Subsequently, Sack arranged structured financing for Step Up Housing’s purchase of Bayside Apartment Homes in Pinole (148 units) for $36.9 million; Sack will provide asset and property management at that location as well.
Berkeley’s multifamily housing market has experienced several ownership changes recently as increased supply has led to lower rents. In February, Read Investments bought Higby apartments—a 98-unit building—for $32 million after it was taken over by its lender via deed in lieu of foreclosure last year. In March, Artemis Real Estate Partners acquired Berkeley Central apartments (143 units) for $55 million—about 40 percent below its assessed value.
Earlier this summer, University Park apartments at 1709 Shattuck Avenue and 1710 Walnut Street went to foreclosure auction after Academy West Investments defaulted on a loan tied to those properties; they are currently listed for sale.
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