A California real estate firm has purchased the $102 million Éilan Luxury Residences apartment complex near The Rim — one of the largest in a recent wave of multifamily acquisitions in San Antonio by out-of-state investors.
FPA Multifamily, which is headquartered in San Francisco and has a regional office in Dallas, bought the 539-unit complex on March 30 from a company linked to private equity firm Lone Star Funds, according to county property records. The purchase price was undisclosed, but the 17.2-acre property was assessed at $102.6 million this year by the Bexar Appraisal District.
The entity that FPA used to buy the complex, FPA6 Eilan LLC, borrowed $68.7 million from Berkadia, a joint venture that includes Warren Buffett’s Berkshire Hathaway, to complete the transaction, records show.
FPA’s purchase also includes 17 retail suites that are currently home to businesses such as Ruth’s Chris Steak House and sushi restaurant Uni’Ko Japanese House, said Tammie Love, a regional manager of Trinity Property Consultants, a subsidiary of FPA that is now managing the apartment complex.
The firm plans to make improvements such as putting in a running trail and upgrading some outdoor seating areas, Love said.
“I’m comfortable, with what I know about FPA and Trinity, that these will be wonderful improvements,” said Ralph Troiano, who manages two community associations that oversee Éilan’s properties.
Rents at the Éilan apartments range from $836 a month for a studio to $2,851 for a two-bedroom, according to its website. The median rent is $1.79 a square foot, said Robin Davis of analytics firm Austin Investor Interests.
The complex’s amenities include a pool with bar service, a fitness center, a tennis court and a billiards room. The apartments are 95 percent occupied, Love said.
Lone Star Funds bought the 120-acre Éilan community in 2013, the year after it was built by Dutch company Wereldhave. Along with apartments, the community includes a 165-room luxury hotel, offices, restaurants and other retail surrounding a piazza, with Tuscan-style stucco exteriors, stone facades and clay-tiled roofs. Altogether, it was assessed at nearly $200 million this year.
The plan all along was to sell the components of Éilan to companies that specialize in particular types of assets, Troiano said. He identified the previous owner as Hudson Advisors, which says on its website that it conducts support services for Lone Star Funds.
Hudson sold Éilan’s offices two years ago, and it intends to sell the hotel and about 44 acres of adjacent vacant land, Troiano said.
“This was a long-term plan for Hudson Advisors when they bought everything in Éilan,” Troiano said. “It’s wonderful that we got to this point.”
A representative of Hudson and Lone Star declined to comment.
The sale of the Éilan apartments came shortly after Chicago real estate firm Accend Companies bought the $70 million Flats at Big Tex complex in Southtown. Several other major apartment complexes have changed hands in the past two years as investors buy into San Antonio’s strong job market and rising population.
The area around The Rim has grown into one of San Antonio’s hottest multifamily markets in recent years, due in large part to its “live, work, play” environment of offices and retail stores. Developers such as Hines and Kairoi Residential have been working on luxury complexes there.
The entire district around the intersection of Interstate 10 and Loop 1604 is booming with new development. USAA Real Estate Co. is working on plans to develop the intersection’s northwest corner, next to the Shops at La Cantera mall, while entertainment venues such as Topgolf San Antonio and iFly have opened at the northeast corner. A $320 million master-planned community is in the works just south of the intersection.
Richard Webner is a San Antonio Express-News staff writer. Read more of his stories here. | email@example.com | @RWebner