According to an article by Brian Miller of GlobeStreet.com, Jeff Wysong of Seattle-based Wysong Capital Corp has purchased the 84 unit Kirkland Gardens West apartment complex for $14.68 mil, which translates to $175,000 per unit. He plans to covert this property to condos, just like he’s doing at the other 4 properties he’s purchased in the past 12 months.
It’s my feeling that there are fewer and fewer convertable properties available and those that are command huge prices. It’s hard for me to believe that an apartment complex with a cap rate of 4.25% is much of a ‘deal’, but I supposed Jeff knows what he is doing.
2 thoughts on “Condo Converters Still Buying”
I expect these converted condos in Downtown Kirkland will have the same look and feel, as to interiors, as the Esplanade in Juanita. The opening prices are expected to be $299,999 to $324,999.
I don’t understand your comment regarding the cap rate of 4.25%. All of the tenants are being released, as the goal is to remodel the units and sell them. Where would the cap rate come into play?
Wouldn’t the cap rate only apply if Wysong was going to keep Kirkland Gardens West as a rental complex?
Where are the other properties you mention he has purchased? Is Esplanade one of them?
Kirkland Wa 98033
Thank you for responding Ardell.
In my humble opinion, investors should be looking at the usual indicators when evaluating deals. If the existing rents cannot support the price, I’d pass it by.
I understand that they plan to convert these units, but am unsure of not only how much it will cost them, but also if they will be able to complete them and if the market will sustain those asking prices as it slows down.
Contrary to popular belief, I do believe that property values are currently greatly exagerated and do not expect them to hold up over the short term.
This should lead to some great opportunities for local real estate investors in the next 3-5 years.