Two East Bay apartment complexes trade for combined $30M

A two-complex multifamily portfolio in the East Bay held by the same families since they were developed in the mid-1980s has sold for nearly $30 million.

Transwestern agent Shivu Srinivasan represented both sides of the deal on the Brightmoor Apartments in San Leandro, as well as the buyer on the Vermont Hills Apartments in Hayward. The seller of Vermont Hills was represented by Matthew Flaherty and Ryan Rodriguez of Colliers International.

Despite the different agents, the sellers and buyers were substantially the same on both deals, though they were marketed and sold separately a few weeks apart. Flaherty said the sellers were the children of the original developers and that they decided to cash out after there was a death among the original ownership group, which allowed them to sell without being subject to capital gains taxes. They do not own any other apartment investments, he said.

Both complexes sold to members of the Salwan family, according to public records, owners of Salwan Property Management and Investment in Hayward. The family owns more than 100 properties in the East Bay, largely concentrated in Hayward, Fremont and San Leandro. They range from multifamily to offices to condos, according to public records.

Vermont Hills Apartments, located at 22815 Vermont Street in Hayward, is the larger of the two complexes. It sold for $19.8 million, or $309,000 per unit, with an in-place cap rate of 4.3 percent. That’s a premium over other similar developments in the area, said Flaherty, where trades have been in the mid to high fives. It was a multiple-offer situation after just a few weeks on the market, he said. 

The 1986 complex with eight buildings has 64 units, with balconies and covered parking, he said.

“The buyer paid a big price,” said Flaherty, citing “immediate scale, good location and newer vintage” as some of the main selling points. He added that the buyers had been in the market looking for a while and got more aggressive on this deal “as a function of frustration.” 

Srinivasan agreed that the price per unit was “exceptional” for the area and attributed it to the “condominium-quality” of the units, attractive two-bedroom, two-bath layouts and amenities like washer-dryers in most units.

The Schlotz and Bright families have been the owners since the property was developed, according to property records, and sold it to Dharam and Vijay Salwan and Seema Salwan Sharma at the end of January.

The Schlotz and Bright families also developed and owned the smaller San Leandro property since it was built in 1984. It has 42 units over four buildings, with an even split of one- and two-bedroom units, as well as a community pool. The sellers accepted a pre-emptive offer, “which speaks to the immediate interest in the property, as well as how good the offer was,” according to a Transwestern rep. It sold for just under $10 million, or $238,000 per unit, earlier in January. The buyer was Rajneesh Salwan, according to public records.

Both properties are located in unincorporated sections of their cities and are not subject to any local rent control jurisdictions. That distinction “provides the new owners with an immediate path to capture rental upside,” Srinivasan said.

Both properties are also in areas that are seeing lower vacancies and rents than the broader East Bay, which had a vacancy rate of 5.4 percent and an average effective rent per unit of $2,177 at the end of 2023, according to Transwestern figures. In the Fairview neighborhood of Hayward, where the Vermont Hills Apartments are located, the vacancy rate was 3.4 percent and the average effective rent per unit was $1,898. In the Ashland neighborhood of San Leandro, where the Brightmoor Apartments are located, the vacancy rate was 4.8 percent and the average effective rent was $1,787.

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