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Norcal portfolio case study.
Investment highlights.
- Portfolio acquisition of 60 properties in the high-barrier-to-entry Marin County submarket (Northern California)
- Total purchase price was $436.5M, which included 936 multifamily units and 680K square feet of office space with a value-add profile
- The portfolio was purchased directly out of bankruptcy, which required working with the restructuring entity, which selected HZ as the stalking horse during the bankruptcy proceedings
- HZ fully flexed the scale and agility of its integrated platform with Graham Street Realty managing the commercial assets and Misson Rock Residential managing the multifamily assets
- Ultimately, HZ selected Davidson Kempner Capital Management as its joint venture equity partner while Wells Fargo provided debt financing
- There was immediate operational and income upside through management improvement and targeted capital expenditures
Property Description
| PROPERTY TYPE | Multifamily & Commercial Office |
| PROPERTY CLASS | B & C |
| LOCATION | Marin & Sonoma Counties, CA |
| AVERAGE VINTAGE | 1980 |
| TOTAL UNITS/SF | 936 Multifamily Units 681,631 SF Office |
Project and Investment Return Metrics
| PURCHASE PRICE | $436,500,000 |
| DEBT | $307,000,000 |
| OCCUPANCY | 91% Multifamily 69% Office |
| CAP RATE | 4.5% |
| TARGET HOLD PERIOD | 3-5 Years |
| GROSS IRR | 18% |
Norcal portfolio examples.
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