EMERYVILLE — A big East Bay apartment complex has been seized by its lender in a deal that points to a weakening market for Bay Area residential properties at a time when offices and hotels have cratered in the region.
Bayview, a 186-unit apartment complex in Emeryville, is now owned by an affiliate of CIM Group after completion of a deed in lieu of foreclosure, according to documents filed on Sept. 20 with the Alameda County Recorder’s Office.
Bayview apartments, a 186-unit, seven-story residential complex at 6701 Shellmound Street in Emeryville, concept.
The seller in the transaction, which is akin to a fast-track foreclosure process, was an affiliate of Amcal Housing, a residential developer based in the Los Angeles County city of Agoura Hills, the county property records show.
CIM Group’s affiliate was the lender for the Bayview apartments complex. In 2021, the lender provided the financing to the Amcal affiliate around the time the project’s construction began. Amcal also developed the project.
The deed in lieu of foreclosure valued the seven-story apartment building at $88.7 million, which was the amount of unpaid debt on the property. The deed stated the Bayview complex was sold for less than its current value.
In January 2024, the Bayview complex was valued at $95.5 million, according to documents on file with the Alameda County Assessor’s Office. That points to a 7% decline in the value of the Emeryville apartment building since early this year.
The lender might seek a new owner for the Emeryville apartment building. This prospect leaves open the possibility the residential property’s value might erode even further.
Declining property values are far more important than a mere academic exercise in the economics of the commercial and residential real estate market.
Property taxes could wilt if buildings are bought for less than their prior values.
This dreary dynamic, in turn, could squeeze tax revenue for numerous city, county and school district agencies in the Bay Area and elsewhere in California that depend on property taxes for big chunks of their revenue.
The Bayview apartment complex at 6701 Shellmound Street near the interchange of Interstate 580 and Ashby Avenue is relatively new. It was completed in 2023.
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The apartment complex contains studios, townhomes and one-, two- and three-bedroom apartments, according to a post on the Bayview website.
Amenities and features include four courtyards with outdoor kitchens, seating and fire pits; indoor and outdoor Wi-Fi access; a seventh-floor lounge with views of the Bay; a state-of-the-art fitness center with yoga and a spin studio; bicycle storage; and on-site electric vehicle charging stations, the Bayview website states.
Numerous office, hotel and retail properties in the Bay Area have suffered foreclosures, declining values, or both in the years after the worst of the coronavirus outbreak.
Why? In the wake of the government-mandated business lockdowns to combat the spread of the deadly bug, workers have returned to the office only at an uneven pace, some retailers have struggled and business travel has slumped.
These trends, in turn, have undermined the values of numerous commercial real estate properties.
Now, some indicators have emerged to suggest the apartment market has also stumbled into a funk of faltering values and even some foreclosure proceedings.