OAKLAND — A big apartment complex in downtown Oakland has been bought for more than $60 million, although the price for the property points to weakness in the city’s multifamily residential sector.
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The just-bought multifamily residential property is located at 1889 Harrison Street in downtown Oakland, documents filed on Jan. 23 with the Alameda County Recorder’s Office show.
The apartment building was bought for $61 million by an affiliate headed up by The Martin Group, the county public files show.
The 224-unit, seven-story residential complex was built in 2019 and is about two blocks away from the popular Lake Merritt area.
It appears the apartment complex sale price represents a slump in the value of the property, a review of public records suggests.
The 19th & Harrison building had an assessed value of $115.7 million as of January 2024. This means the latest purchase price was 47.3% below the Alameda County Assessor’s Office estimated value.
Assessed values go well beyond a survey of the local real estate economy. Property value trends can have an impact on revenue for an array of public agencies.
If real estate values turn soft in a jurisdiction, that could crimp a crucial revenue stream for city, county and regional agencies, as well as school districts.
The $61 million price for the 1889 Harrison apartment building also was less than a $70.8 million loan the selling group received in 2021 for the property, county documents show. MetLife Real Estate Lending provided that financing for the residential complex.
Quarterra Multifamily, a spinoff of a Lennar Group subsidiary, headed up the affiliate that sold the apartment building to the Martin Group, Alameda County real estate and Lennar regulatory filings show.
By happenstance, a Quarterra Multifamily affiliate sold another big apartment complex at a nearby downtown Oakland location about a month earlier in December — also at a price that hinted at weakening values.
On Dec. 20, a Quarterra entity sold an apartment tower at 447 17th Street in downtown Oakland for $99 million. That purchase price was 53% below the highrise’s assessed value of $209.8 million.
These two transactions are just two landmarks in what is becoming a forbidding landscape for some sections of the East Bay residential market.
In recent months, lenders have seized multiple apartment complexes to satisfy delinquent or failing loans. Among the problem properties:
— A 206-unit, 24-story housing tower at 1700 Webster Street in downtown Oakland was taken back on Aug. 28, 2024, by its lender due to a delinquent $90-million loan.
— The Logan, a 204-unit apartment complex at Telegraph Avenue and 51st Street in Oakland, was taken by a real estate firm that had bought the property’s loan and then foreclosed on the financing vehicle on Nov. 27, 2024.
— In September 2024, Bayview, a 186-unit apartment complex in Emeryville, was seized by its lender CIM Group on Sept. 20 through a deed in lieu of foreclosure procedure.
As for the just-bought apartment building at 1889 Harrison, the new owner, Martin Group, has extensive experience in the Bay Area multifamily residential market, including several properties in Oakland.
Including the Harrison Street apartments, Martin Group’s portfolio includes at least seven apartment complexes in Oakland, a student housing property in Berkeley, and at least one apartment building in San Leandro, Alameda, Napa and San Mateo, according to the Martin Group website.
