The apartment market in
West Hollywood,
Hollywood,
Hancock Park-Wilshire,
Mid-Wilshire and
Silver Lake - Echo Park during the
1st Quarter 2010 shows buildings trading from 7.5 - 12.6 GRM (and everything in between).
- West Hollywood - 11.7 - 12.6 (B Class, A Class)
- Hancock Park - 11.3 - 11.4 (A Class)
- Hollywood - 8.8 - 11.4 (B Class, A Class)
- Mid-Wilshire - 7.5 (B Class)
- Silver Lake - 11.2 (A Class)
It's noteworthy that A Class buildings in A neighborhoods are selling in the range of
11.2 - 12.6 GRM. (Roughly 5.5 - 8% cap / capitalization rate).
****************************************************************************************
If you have any questions about the Los Angeles income property market, please contact us by
clicking on this link to send us an email or by calling us at (310) 845-6810.
You can also subscribe to our quarterly
Los Angeles Investment Property Newsletter by
clicking on this link. To see our 1st Quarter 2010 newsletter,
click on this link.****************************************************************************************

In
West Hollywood,
1285 N Sweetzer Avenue sold for an 11.7 GRM. This building has 28 units, 22,804 sq ft of living area, and sold for $6.1 million with gross income of $520,000. 25 x 1 br, 2 x 2 br, 1 x 3 br. This large, well-maintained complex sets the bar for what investors can expect in an A-Class, A-quality neighborhood. It's interesting to note that the largest sale in Santa Monica during the 1st Quarter 2010 was also at
an 11.7 GRM.
7703 Hampton Avenue in
West Hollywood sold for a 12.6 GRM. This building has 9 units, 6,594 sq ft of living area, and sold for $2,032,000 with gross income of $162,000. 9 x 1 br. The building has no deferred maintenance and low (3%) vacancy.

Two sales in Hancock Park illustrate (1) what returns buyers can expect for a trophy/historic/architectural building; and (2) the consistency of returns in neighborhoods.
180 S Sycamore Avenue in
Hancock Park sold for an 11.4 GRM. This building has 15 units, 12,966 sq ft of living area, and sold for $3.4 million with gross income of $299,000. 3 x 0 br, 9 x 1 br, 3 x 2 br. The building is in a much sought-after Spanish style in the much sought-after Hancock Park neighborhood.
100 N Sycamore Avenue in
Hancock Park sold for an 11.3 GRM (vs. 11.4 above). This building has 13 units, 16,588 sq ft of living area, and sold for $3,050,000 with gross income of $269,000. 9 x 1 br, 4 x 2. This historic building qualifies for Mills Act property tax reduction (typically 20 - 50%). LA investors know the value of these prestige buildings (1920-30s), which never go out of style with renters.

Turning to
Hollywood, we also find an 11.4 GRM for an A-Class building in an A-Class part of the neighborhood.
6824 Camrose Drive has 10 units, 7,478 sq ft of living area, and sold for $1.5 million with gross income of $131,000. 8 x 1 br, 2 x 2 br.

In urban part of
Hollywood, like
7703 La Mirada Avenue, investors can get the best returns -- an 8.9 GRM on current rents. This building has 26 units, 18,201 sq ft of living area, and sold for $2.4 million with gross income of $273,300. 4 x 0 br, 20 x 1 br, 2 x 1 br. A "hands on" owner operator could capitalize on the 24% upside on the building's rents.

Another building offering excellent returns is
4100 West 1st Street in
Mid-Wilshire, that sold at a low 7.5 GRM. This building has 23 units, 19,329 sq ft of living area, and sold for $2,185,000 with gross income of $291,000. 19 x 1 br, 4 x 2 br.
3821 Effie Street in
Silver Lake sold for an 11.2 GRM. This building has 6 units, 5,310 sq ft of living area, and sold for $1,075,00 with gross income of $96,000. 6 x 1 br.
Silver Lake and
Echo Park remain a magnet for post-college renters and local investors like this type of small, easy-to-rent, easy-t0-manage complex.
No comments:
Post a Comment