Timberlane's $37M buy bets on Issaquah upside

Seattle-based Timberlane Partners has paid $37 million for Vista Ridge, a 91-unit garden-style complex in Issaquah, Washington, in a deal that Connect CRE reports, citing the Puget Sound Business Journal, values the property at roughly $406,600 per unit; the seller is Belkorp Holdings, based in Vancouver, British Columbia.

The 1992 property at 201 Mountain Park Blvd. SW spreads eight buildings across seven acres and 107,077 square feet, with two- and three-bedroom apartments averaging 1,106 square feet. It sits close to historic downtown Issaquah and Gilman Village, near trails, shopping and dining, and convenient to I-90 and SR 900. A buyer can modernize apartments from that era, but it cannot recreate the position.

Vista Ridge is Timberlane Acquisition Fund II's third acquisition, following Wonderland Creek Townhomes in Colorado and the Jackson Apartments in Seattle. Because Connect CRE gives no financial terms for those earlier deals, the Issaquah purchase is the first place the fund's pricing discipline can be read.

At $406,600 a door, a 1992 property is a business plan rather than a stabilized older-housing trade; no renovation program appears in the reporting, which leaves room for interpretation, but the number implies Timberlane expects future income from these apartments to justify the purchase. It is the vintage-product form of the apartment-capital trade this publication has argued is driving capital: paying for operating and renovation upside as cap rates reset.

The same number carries the risk. If the improvements required to support $406,600 a door take longer or cost more than expected, the basis leaves little room to adjust; if Issaquah rents soften, it leaves none. Belkorp exits with proceeds today, while Timberlane inherits the assumption that the market and the building will move toward the price.