Sunday, March 16, 2014

TODAY'S DEALS: SARES-REGIS Acquires San Jose Apartments

<Deal Nowp>San Jose, Calif.-SARES-REIGS Multifamily Fund has completed its sixth acquisition with the purchase of Alterra, a 143-unit apartment community in San Jose, Calif. The 5.1-acre gated community at 1640 La Rossa Circle was built in 1988. It is near the Almaden Expressway, Highway 87 and less than one mile from the VTA, Santa Clara's light rail system, and Caltrain.

"Alterra offers a solid value-add opportunity to renovate and reposition the property so it competes with neighboring communities while capitalizing on the region's significant employment and rental growth," says Kenneth Gladstein, Co-Chief Investment Officer of the SARES-REGIS Multifamily Fund. "Alterra is our third acquisition in California since we formed the fund last year."

Although the previous owner completed significant exterior and common-area renovation, the apartment interiors are original, Gladstein says. The value-add program for Alterra includes upgrading of kitchen cabinets, countertops, stainless appliances, flooring, lighting and plumbing fixtures.

"Once completed, the newly renovated apartment homes will offer residents a value alternative to brand-new product coming into the market," Gladstein adds.

The Fund was launched in 2013 by SARES-REGIS Group with more than $100 million in equity commitments, giving it the ability to acquire more than $300 million in assets.

Kiser Group brokers $28.9M Chicago sale

Chicago-Kiser Group represented the seller of an eight-building, 236-unit portfolio of apartment and mixed-use properties on Chicago's North Side. New York-based Pioneer Acquisitions purchased the portfolio for $28.9 million in a sale that closed March 5, 2014.

Family owned for more than 60 years, the portfolio included an apartment building in West Rogers Park; an apartment building and mixed-use retail and apartment property in Lincoln Square; four properties in Ravenswood; and a mixed-use retail and apartment building in Irving Park.

"This rare opportunity attracted several investors," says Lee Kiser, principal of Kiser Group. He and Michael D'Agostino, managing director of Kiser Group, represented the seller in the transaction. "It's an enormous portfolio in a strong location with upside potential.

"Many of the units are rented at below-market levels, so the buyer could immediately reap additional income by increasing rents," Kiser adds. "Also, with some minor renovations, many of the large one-bedroom units could easily be converted into two-bedroom apartments, further adding value and increasing the portfolio's annual income."

The seller regularly made upgrades throughout the past six decades, so the buildings have little to no deferred maintenance. All the buildings include coin-operated washers and dryers, private storage lockers, intercom security and secure bicycle areas.

"These high-quality apartments are located in sought-after neighborhoods on Chicago's North Side," D'Agostino said. "Also, the large rooms, high ceilings, hardwood floors and irreplaceable vintage architectural details made this portfolio enticing to buyers."

The eight-building portfolio included the following properties.

West Rogers Park

    -7434-38 N. Artesian / 2432-34 W. Fargo is a corner 12-unit apartment building located immediately south of the Evanston border. It consists entirely of one-bedroom, one-bath units. The property also has a two-car garage.

Lincoln Square

  • 4621-25 N. Lincoln / 2259-63 W. Eastwood is a mixed-use building that includes four retail spaces fronting busy Lincoln Avenue and 25 apartments. Long-term commercial tenants occupy three of these units. The apartment mix includes seven one-bedroom, one-bath units; and 18 studios.
  • 2243-51 W. Eastwood, a 16-unit apartment building located just off Lincoln Avenue, is a vintage walk-up consisting entirely of one-bedroom, one-bath apartments.


  • 2104-24 W. Foster (40 units) sits across from Winnemac Park and includes two 20-unit buildings consisting entirely of one-bedroom, one-bath apartments. The property also offers 15 parking spaces.
  • 5073-75 N. Wolcott / 1825-31 W. Winona (16 units) is a vintage walk-up consisting of 13 one- and three two-bedroom apartments, each with one bath. It has newer porches and windows.
  • 2100-12 W. Ainslie / 4904-10 N. Hoyne (46 units) is a vintage courtyard building one block south of Winnemac Park and within walking distance of the Ravenswood Metra Station and the Brown Line 'L' stop at Damen Avenue. It includes 12 studios, 28 one- and six two-bedroom units, each with one bath.
  • 4915-19 N. Damen (21 units) is an L-shaped walk-up consisting of 16 one- and three two-bedroom units, each with one bath, and 1,000 square feet of retail currently occupied by two commercial tenants. It is also close to the Metra Station and the Brown Line 'L' stop, as well as a short walk to the new Mariano's.

Irving Park

    4101-13 N. Kedzie / 3148-56 W. Belle Plaine (56 units) is a mixed-use courtyard building consisting of three studios, 47 one-bedroom, one-bath units and approximately 3,600 square feet of retail space currently occupied by six commercial tenants. The property is convenient to the Kennedy Expressway.
NorCal apartment portfolio changes hands

Redwood City, Calif.-A 112-unit portfolio on the San Francisco Peninsula in Redwood City, Calif., has traded hands for $23.2 million, or $207,142 per unit. Marcus & Millichap represented the seller, Interstate Equities Corp., in the five-property transaction. The buyer was a private investor in a 1031 exchange.

"The continued creation of high-paying jobs in Silicon Valley is reshaping the San Mateo County apartment market and creating new opportunities for both large institutional investors and smaller private investors," says Adam Levin, a vice president of investments at Marcus & Millichap. "Favorable market conditions in Redwood City allowed us to assemble this portfolio of 1960s-era apartment complexes and for IEC to successfully implement its renovation, stabilization and repositioning strategy."

Levin worked alongside Robert Johnston, a senior associate, in closing the deal. Both are based in the firm's Palo Alto office.

The properties are:

  • 152 Lincoln Ave., 18 units
  • 180 Buckingham Ave., 48 units
  • 755 9th Ave., 8 units
  • 775 9th Ave., 8 units
  • 1331 Jefferson Ave., 30 units


Friday, March 14, 2014

Garland accuses former fire administrators of cheating on tests

Two former Garland Fire Department administrators accused of cheating on Review exams from 2009 to 2013 are being sued by the city for more than $1 million.

Former Assistant Chief Todd Peele, 43, and former Capt. Michael Cates, 45, are accused of using smartphones and hidden Bluetooth equipment to gain an unfair advantage over others who were testing for departmental promotions.

A third conspirator is not named or included in the suit as part of the city's legal strategy, according to the city attorney's office. All three have resigned from the Garland Fire Department.

Peele could not be reached for comment. Cates did not return a phone message. Both served the department for more than 20 years. Neither has submitted an answer to the lawsuit filed last week in Dallas County.

"By defrauding the city and cheating on their promotional examinations, Peele and Cates were paid tens of thousands of dollars in money they did not deserve," the suit said.

The city also asks that they be denied retirement benefits. The city claims it is also owed exemplary and/or punitive damages because it has suffered injury by promoting Peele and Cates over more deserving candidates.

By state law, promotions are by competitive examinations only. A department must give 90 days' notice before testing and must list source materials from which the questions will be asked. The test results determine who gets promoted.

"Each Garland firefighter has every right to expect that their brother and sister firefighters, the people with whom they entrusted their very lives, would compete for the limited promotional positions honestly and without cheating," the suit says.

Instead, the suit alleges, the three devised a means for a person taking an exam to get help from co-conspirators who had the source materials available outside the testing site.

When promotional exams were announced in early 2009, the suit says, Peele asked Fire Department officials for permission to read questions aloud during the exam, "falsely alleging that it was necessary for him to read aloud to himself to properly understand the questions."

The person taking the test would read the questions while having a cellphone line open to the co-conspirators. They would look up answers and provide them through a small, hidden Bluetooth device in the test taker's ear.

It won't be easy to fix things for those who missed promotions in the five tests in which cheating is alleged. Runners-up who score a passing grade are put on an eligibility list to be promoted in case of a vacancy. But state law also prescribes that those lists are to be kept only one year.

And those who missed the battalion chief spot Peele gained in 2009 wouldn't have the rank to have tested for assistant chief three years later.

Assistant City Attorney Michael Betz said the city is bound to Chapter 143 of the local government code in filling the vacancies.

"Whether anyone would be promoted retroactively is entirely dependent on 143," he said.

Betz said the city is not aware of any qualified potential fire administrators who have since left the department.

The law also states that a person commits an offense by knowingly or intentionally revealing a part of a promotional examination to an unauthorized person or receiving from an authorized or unauthorized person a part of a promotional examination for unfair personal gain or advantage. The penalty is a fine of at least $1,000 and up to a year in county jail.

Prosecution of any crime related to cheating on civil service exams would be separate from Garland's civil case and would be handled by federal or county attorney's offices.


April 7, 2009: According to the city's suit, the unnamed co-conspirator had outside help from Peele and Cates during a test to earn a promotion to fire driver.

April 8, 2009: The suit alleges Peele had help from the co-conspirator and Cates and scored a 98 on a test to earn a promotion to battalion chief.

May 26, 2010: The suit alleges Cates had help from the co-conspirator and scored a 95 on a test to earn a promotion to fire lieutenant.

May 23, 2012: The suit alleges Peele had help from Cates and/or the co-conspirator and scored a 98 on a test to earn a promotion to assistant chief; Cates called in to work sick that day.

March 5, 2013: The suit alleges Cates had help from Peele and/or the co-conspirator and scored a 96 on a test to earn a promotion to fire captain.

SOURCE: Dallas County court records

Tuesday, March 11, 2014

TA Plays Live: Another Case of the Mondays

<Coupon Codep>It's Monday, and I feel like I'm going to die because I accidentally drank caffeinated coffee after being caffeine free for close to four months now... But death, or close to it, won't stop me from streaming on Twitch. That's my level of dedication to this dog and pony show we're running here. That, and I finally have a captive audience to discuss True Detective with.

Anyway, if you haven't yet, please follow us as it's the best way to get notified when we're streaming.

To tune into the TA Plays Live stream you've got three options:

  • The easiest is to just scroll down to see the embedded video stream and chat below. Make sure to turn the volume slider up if you want to hear game audio and commentary.
  • Visit the TouchArcade channel on Twitch directly and watch over there.
  • Download the Twitch.TV app [Free] and either hit this link on your device or simply search for the channel TouchArcade.

I usually stream until 6:00 PM Central, at which point (today especially) I'm getting out of here to go play some Titanfall with friends. That's coming out tonight, if you're in to the whole PC/console gaming thing and I hear it's pretty cool.