Universe Holdings has acquired the Stonegate Apartments (Stonegate), a 160-unit multifamily community in Southern California’s Inland Empire city of Riverside, in an off-market transaction worth $53.370 million.
Built in 1987, Stonegate offers a mix of one- and two-bedroom floorplans and a strong amenity package, including a fitness center, swimming pool, spa, barbecue area, pet park, playground, covered parking, four laundry rooms and a business center. The property’s location at 6506 Doolittle Ave. in west Riverside gives residents access to five major freeways (60, 91, 10, 15, 215) that connect the area to the Inland Empire’s more than 1.9 million jobs, as well as Los Angeles and Orange counties.
Stonegate represented an opportunity for Universe to acquire a stabilized asset with the ability to add value by upgrading a portion of units that are outdated.. The Los Angeles-based real estate investment firm plans to invest $100 million in the market over the next 24 to 36 months, according to Universe Founder and CEO Henry Manoucheri.
“We see significant opportunities across the Inland Empire and plan to aggressively pursue acquisitions to further grow economies of scale and establish a foothold in the market,” said Manoucheri, whose firm cultivated relationships and actively searched the market that spans two counties (San Bernardino and Riverside) for more than a year.
“Stonegate is an exceptional asset that we were able to acquire below replacement cost. We plan to increase value through hands-on property management and an ambitious renovation plan,” he said.
The Inland Empire’s phenomenal growth in population has been fueled by its lower cost of living compared to nearby Los Angeles and Orange County markets and rising demand for warehouse workers needed to meet the employment demand created by the continuing influx of logistics centers. The Inland Empire is one of the most prominent distribution hubs in the Western U.S. with its growing number of e-commerce warehouses helping to fuel the market’s booming economy.
Due to increased construction costs and challenges with the entitlement process, there is a lack of new multifamily development in the market, creating heightened demand from the area’s growing population.
“With its strong population growth, growing job opportunities and affordable cost of living, the Inland Empire checks all the boxes when it comes to demand drivers we look for in a new market,” Manoucheri said. “The market’s relative affordability is one of several key factors that we value in this market.”
IPA represented the seller in the transaction. Senior Managing Director Charles Halladay, Director Jonah Aelyon and Analyst Jolie Zhou from JLL’s San Francisco office obtained the debt for Universe. Universe’s other Inland Empire asset, the 304-unit Acacia Park community located less than 30 minutes from Stonegate in San Bernardino, was acquired in 2003. Universe had previously purchased a third property in the Inland Empire in the early 2000s, a 320-unit multifamily property in Temecula that they sold in 2012.