Marcus & Millichap Arranges Trade of Viking Apartments in Peninsula at Above-Average Per-Unit Price
- Jul 31, 2014
A Peninsula multifamily property recently traded hands in a deal worth $10.8 million. Marcus & Millichap arranged the transaction for the Burlingame, Calif. asset at a per-unit rate of $308,571. The seller is a family that owned the property for around 50 years, while the buyer is another local family trust. Both parties were advised by representatives of Marcus & Millichap’s Palo Alto office, with associate Richard Reisman handling the seller’s end, and vice president investments, Adam Levin, working on behalf of the buyer.
The Viking Apartments residential complex in Burlingame offers a total of 35 units. The 1958-built apartment complex is located at 500 El Camino Real in one of Burlingame’s more high-profile neighborhoods. The residential property offers a total of 21,007 square feet of rentable space. According to a press statement announcing the transaction, Adam Levin predicted that Viking Apartments is set to become one of a number of properties in the area that have been acquired, and were then repositioned in order to boost gains from the property.
According to Marcus & Millichap’s San Francisco Metro Area Apartment Market Report for Q2 of 2014, the average sales price for multifamily properties stood at around $264,300 per unit for the last year. That means that the market has recorded a 17 percent increase over the previous 12 months, while buyers are reportedly still setting their sights on assets that bear value-add potential. This makes the aforementioned deal an above-market transaction with a per-unit sales price of more than 40k compared to the Metro Area’s average.
The report mentions that the market’s immediate future remains with buyers that can navigate local legal constraints of the low-yield market. Purchases might require an immediate capital infusion immediately afterwards, with amenity enhancement the primary focus.
Chart courtesy of Marcus & Millichap Real Estate Investment Services at marcusmillichap.com