Bedford Affordable Housing Buys San Jose Apartments for $88M

The Bedford Affordable Housing Foundation has bought a 262-unit apartment complex in San Jose for $87.7 million. Its goal: to keep rents low enough for tenants with modest incomes.

The newly created Beverly Hills-based nonprofit picked up the Almaden Terrace apartments at 2118 Canoas Garden Avenue, in Willow Glen, the San Jose Mercury News reported. The seller was a limited partnership called Willow Glen Associates West, and was represented by TCI Properties founding partners Dennis Danielian and Jesse Goldstein in the transaction, according to the Silicon Valley Business Journal.

The deal works out to $334,733 per unit. The transaction was financed by lenders including the Federal National Mortgage Association, known as Fannie Mae, and the California Statewide Communities Development Authority. To facilitate the purchase, California Statewide Communities issued $71.4 million in revenue bonds.

The deal included affordability covenants for a majority of its units in a market where average asking rents have climbed above $3,100 per month and are projected to rise faster than any other major U.S. city.

The two-story complex, built in 1972, includes a pool, media center, movie theater, picnic area, and dog park, according to Apartments.com. Asking rents were not disclosed.

Under terms of the sale, Bedford Affordable must ensure that at least 40 percent of the apartments are set aside for low-income residents, documents show. That works out to 105 units.

At least 75 percent of the units, or 197 apartments, will be set aside for people at 80 percent of the area median income, which works out to $115,080 a year for one person in Clara County, according to the Mercury News.

The Bedford Affordable Housing Foundation, launched early last year by Jeff Platt in West Hollywood, aims to create and maintain affordable housing and related services for low-income and very low-income residents, according to its website and state business records. The foundation, now based in Beverly Hills, is led by Doug McEachern.

Meanwhile, other investors are working to tamp down rents in San Jose.

In April, the Sobrato Organization and Pacific West Communities filed preliminary plans to turn a 1.3-acre parking lot at 143 South Third Street in downtown San Jose into a 173-unit affordable housing development.

In March, an affiliate of Post Investment Group, based in Beverly Hills, purchased the 152-unit low-income apartment complex at 1930 Almaden Road in San Jose for $41 million.

– Dana Bartholomew