By: Jacquelyn Ryan
In a game of musical buildings, two Orange County investors have bought each other’s properties.
Investor Darcy Bolton sold two Anaheim, CA apartment buildings to investor Marty Campbell, who then sold Bolton his apartment complex in Oceanside, CA. Both property owners completed the sales as part of 1031 Exchanges, which allow a property owner to postpone paying taxes on capital gains from a recent sale if the proceeds are reinvested in the acquisition of a similar property.
Campbell bought the Anaheim properties, the Franciscan at 120 N. Syracuse St. and the Adelphi at 2750 W. Yale Ave., from Bolton for $27.5 million this month. The buildings, which total 105 units, were built in 1966 and have not received significant modern upgrades.
Bolton bought the 72-unit Ocean Breeze Village at 2055 Poplar Rd. in Oceanside for $22.7 million from Campbell, who had recently upgraded the nearly 30-year-old property.
Bolton also acquired a 64-unit Terra Oceanside property 3965-3970 Waring Rd. from a separate investor, Bryan Perraud, for $17.5 million in order to reinvest all of his capital to satisfy rules of the 1031 Exchange.
In total, the transactions amounted to $67.7 million.
The deals came about organically, said Tyler Leeson, senior managing director investments in Marcus & Millichap’s Newport Beach office, who brokered the transactions.
After completing upgrades at his Oceanside properties, Campbell was eager to take on another value-add project, which made the aging Anaheim properties attractive. He approached Bolton to purchase the properties and, in a moment of serendipity, learned Bolton had been looking for a turn-key investment like the upgraded Oceanside properties. Campbell agreed to sell his as part of the deal.
“Obviously, it’s really complex,” Leeson said. “Making all of these things close simultaneously and completing such a complex transaction is satisfying to us, especially knowing everyone was happy with the deal.”