#United States #San Diego #Sunstone Two Tree #Terraza Hills

Sunstone Two Tree Targets Housing Improvement in San Diego

In a significant move to enhance living conditions in high-demand areas, Sunstone Two Tree has successfully acquired a 200-unit apartment complex in San Diego, California. This acquisition represents the firm’s strategic focus on developing rental housing communities in growth-oriented markets across the United States. As announced on March 31, 2025, the property known as Terraza Hills, located on the north side of El Cajon, was purchased for a total of $45 million, or approximately $225,000 per unit.

The Terraza Hills community, built in 1976, has remained largely in its original state until now. With minimal new multifamily developments in the East San Diego submarket, where only 88 new units were introduced in 2024, this acquisition comes at a crucial time. Scott Maddux, the President and CEO of Sunstone Two Tree, highlighted that it is essential to invest in and maintain existing housing inventory to provide affordable living options for families now and in the future. This commitment is driven by the pressing need for improved quality and availability of rental units in San Diego's housing market.

The renovation plans for Terraza Hills are both extensive and promising. Sunstone Two Tree intends to incorporate modern upgrades throughout the community. Each apartment unit will receive several enhancements, including new vinyl plank flooring, hard surface countertops, updated lighting fixtures, stainless steel appliances, and contemporary cabinetry. The exterior of the property will be revitalized as well, featuring new paint, improvements to exterior finishes, enhanced lighting, and renovations to the parking lot and landscaping.

Additional upgrades will include refinishing backyards, renovating parking garages, and constructing new carports. Furthermore, the pool area will be transformed, with new security features like gates and fencing being installed around the community’s perimeter. The renovation project is slated to commence in April 2025, with an expected timeline for completion extending over approximately two years.

This acquisition marks Sunstone Two Tree’s first venture into San Diego County, a decision influenced by the area's promising supply-demand balance. El Cajon is notably positioned near downtown San Diego, multiple universities, and the airport, combining accessibility with community resilience. The firm remains confident in the submarket's attractive fundamentals, including healthy rental occupancy rates and steady rent growth.

With a robust background in the real estate sector, Sunstone Two Tree aims to create an integrated approach to community enhancement. Established in 2023 through the merger of Sunstone Properties Trust and Two Tree Capital, the company specializes not only in the acquisition and renovation of existing multifamily properties but is also dedicated to developing single-family rental communities. The underlying mission of Sunstone Two Tree is two-fold: to safeguard investor capital while ensuring the delivery of exceptional returns through various economic phases, alongside creating well-maintained, safe housing options for families.

In conclusion, Sunstone Two Tree’s acquisition of Terraza Hills embodies a commitment to improving the affordability and quality of living in San Diego. By investing in significant renovations and adhering to strict quality standards, the company is set to contribute positively to the local housing landscape, ensuring future generations have access to comfortable living spaces in this vibrant community.