Seattle multifamily investor acquires Everett complex for $83 million

Originally published: bizjournals.com

An Everett apartment complex near the Boeing factory has changed hands for $82.75 million.

Seattle-based Timberlane Partners bought the 336-unit Canopy Apartments at 811 112th St. SW, according to a bargain and sale deed Snohomish County recorded Nov. 4.

EOS Residential Investors, an investment firm headquartered in New York, joined the deal as a capital partner. The Denver office of LaSalle Investment Management provided a $66 million loan to EOS to purchase the property, records show.

The seller was a limited partnership affiliated with Rise Properties Trust. The private real estate investment trust had acquired Canopy Apartments in 2019 for $80.25 million.

It's a return to Snohomish County for Timberlane, which currently owns more than two dozen properties in the Puget Sound region, California, Colorado, Texas and Utah. The company sold a 61-unit apartment complex in Marysville for $15.5 million in 2021.

"We spend a lot of time looking across the market for the best relative value, and we've been willing to remain patient when opportunities aren't there," Timberlane co-founder and CEO Dave Enslow said in a news release. "Canopy stood out because we are acquiring a substantially renovated, well-located community at a basis that we believe makes sense for where the market is today."

The Northend multifamily market had an occupancy rate of 94.9% at the end of the second quarter, according to data from Colliers. It mirrored the overall Puget Sound region's occupancy rate of 94.9% and was 0.3 percentage points higher than Seattle's 94.6%.

But the Northend is relatively more supply constrained. The 642 units under construction across the Northend at the end of the second quarter were the lowest among all multifamily markets in the region. In particular, the Lynnwood/Edmonds/Mukilteo submarket did not have a single new apartment unit under construction.

The $2,002 average monthly rent in the Northend was higher than the $1,800 and $1,869 in Tacoma and Southend markets, respectively.

"This market has aerospace, manufacturing, trade, the Port and the Navy supporting a deep employment base, while residents can still find considerably more housing value here than in areas closer to Seattle or Bellevue," Enslow said. "Combined with limited new apartment supply, these factors create what we believe are strong long-term investment fundamentals."

Canopy Apartments is located about 3 miles southeast of Boeing's Everett factory and corporate offices. With approximately 30,000 employees, Boeing is the largest employer in Everett. Seattle Paine Field International Airport is also nearby.

The apartment complex sits on a 15.89-acre site. Built between 1989 and 1991, its 20 residential buildings offer a mix of one-, two- and three-bedroom units. The average unit measures 878 square feet.

Amenities include a swimming pool, fitness center, community lounge, game room and dog park.

Of the 336 total units, 245 were fully renovated with luxury vinyl plank flooring, quartz countertops, tile backsplashes, stainless steel appliances and new cabinetry. Another 90 had their kitchens renovated.

The property has an assessed value of $97.17 million.

"The previous ownership did a very good job improving the property, so we're buying a community that's already in great condition," Timberlane co-founder John Chaffetz said in the release. "Our opportunity is to manage it well, make targeted improvements where they matter, and position the property for long-term success."

Avenue5 Residential will serve as the property manager.

In August, Timberlane bought a 91-unit apartment complex in Issaquah for $37million. The company has a proposal to redevelop the Ballard Goodwill property in Seattle into a six-story, 300-unit mixed-use development. It also has a plan to build a seven-story, 189-unit apartment building in Fremont.