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December 09, 2016

NBA star David Robinson scores big on Kent apartment investment

Puget Sound Business Journal

Marc Stiles

Security Properties of Seattle and former NBA star David Robinson's company sold a Kent apartment complex for $56.6 million last week, according to public records, $16.4 million more than they paid for it less than two years ago.

The buyers were listed on a public document as a group of limited liability companies licensed in Delaware. Kidder Mathews commercial real estate brokers Philip Assouad and Giovanni Napoli handled the sale.

Security Properties and Robinson's Admiral Capital Group (named after his nickname, "The Admiral') said they bought the 29-year-old Waters Edge in early 2015 for less than what it would have cost to build and started a major renovation. The cost of that work wasn't disclosed, but the sellers said it entailed re-siding the complex's 33 buildings, replacing wooden decks, installing new kitchen cabinets and appliances, and renovating bathrooms, among other improvements.

It's a classic play: Buy a property that needs work, fix it up, raise rents and sell.

It's a good time to sell because investors are eager to buy apartments in lower-cost submarkets where people are moving as they get priced out of Seattle. These days hardly a week goes by that a big suburban complex doesn't sell.

The investment in Waters Edge (6305 S. 236th Place in the Lakes master-planned community), was Admiral Capital's first acquisition in the Seattle area. Jarett Kaplus, a principal at Admiral, said the investment was a continuation of his company's long-term relationship with Security Properties, a national real estate investment company.

Robinson, who got his nickname because he graduated from the U.S. Naval Academy before playing for the San Antonio Spurs, co-founded the Admiral Capital Group with Daniel Bassichis, formerly of Goldman Sachs. Admiral Capital, which has offices in Seattle, San Antonio and New York, buys "value add" properties, or real estate that needs work.

In addition to apartments, Admiral Capital buys retail, office and hotel properties. The company says it has bought more than $500 million worth of assets since 2008. The founders pledge 10 percent of their profits to philanthropic causes.

For the full story, go to Puget Sound Business Journal.

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