29 Jan 2019
LOS ANGELES, CA—Matthews Real Estate Investment Services™ is pleased to announce the successful execution of a 1031 Exchange from a multifamily investment to two single-tenant net-lease investments. Matthews™ Senior Associate, Kyle Mirrafati, facilitated the sale of an off-market 28-unit apartment in the Palms Neighborhood of West Los Angeles for $7,100,000 at a 3.36% CAP Rate into two 7-Eleven properties with gas in the Daytona Beach- metropolitan area for a combined purchase price of $7,700,000.
The seller, an out-of-state mom-and-pop owner, was motivated to sell the multifamily property, located at 9714-9720 Regent Street, as the building had a considerable amount of deferred maintenance, was difficult to manage, and did not generating enough income due to rent control laws. The buyer, an institutional client, admired Regent Streets proximity to Downtown Culver City, and the rental upside potential the building offered.
While Mirrafati encountered a long escrow process, negotiating two 30-day seller extensions, he was able to retain the buyer and seller’s focus on the bigger picture. Mirrafati was able to show the seller that they could exchange into an investment that had zero management responsibilities and would increase their overall cash-on-cash return.
By utilizing the Matthews™ 1031 Exchange Program, Mirrafati presented the seller with two off-market 7-Eleven’s in Florida that Aron Cline, Senior Vice President and Senior Director of Single-Tenant Net-Lease at Matthews™, had listed for sale. These properties were brand new developments with great surrounding demographics, on a long-term corporate lease with an investment grade tenant.
“This is a great success story that demonstrates the power of the Matthews™ platform, and our 1031 Private Client Advantage Program is very influential for buyers and sellers,” said Cline. “ We were able to offer the two 7-Eleven’s with pre-commitments before rent commenced, with aggressive cap rates,” Cline continued. “Both the seller and buyer were pleased with the outcome of the transaction, as the buyer exchanged into an asset that required zero management responsibilities.”
“The transaction was perfectly timed,” said Mirrafati. “Within a week of closing Regent Street, the seller purchased the two 7-Eleven properties resulting in limited income loss and a smooth transition into their new investment that increased their overall cash flow by 30%,” Mirrafati concluded.
For more information on 9714-972- Regent Street or the Matthews™ 1031 Private Client Advantage Program, please reach out to Kyle Mirrafati with any questions relating to your multifamily investment(s), and Aron Cline for questions relating to your net lease investment(s). Aron Cline currently has an additional ten newly constructed 7-Eleven’s under contract with a trade buyer from California, and Kyle Mirrafati has a non-contingent multifamily asset in escrow. If you want to view our current listings, please visit WWW.MATTHEWS.COM.
Matthews Real Estate Investment Services™ is recognized as an industry leader in multifamily, shopping center, net lease, management, leasing, portfolio disposition, and 1031 exchange programs. The firm is headquartered in El Segundo, CA and serves clients throughout the United States and Canada. For more information, please visit WWW.MATTHEWS.COM.