Palo Alto apartment tower sells for $405K per unit-and they’re all studios
This is the first time the six-story building, at 535 Everett Ave., has sold since 1990 when it traded for $6.95 million, or $77,000 per unit. The seller was a private investor.
The sale is not a record for the Peninsula, but it shows the high prices investors will pay for well-located assets in Palo Alto, which do not often come up for sale. The building, constructed in 1964, has 48 larger studios, according to a listing.
“In addition to the living area, all units have large balconies with sweeping views,”according to a listing from Stephen Lampe, of RE/MAX Commercial & Investment Realty, who didn’t immediately return a call.
The sale price is less than at least one other mid-century comp I dug up: The Towle Apartments, a 42-unit project at 696 Towle Way built in 1965, which traded for about $429,800 per unit last October.
Pacific Urban Residential didn’t return a phone call. In January, the California Public Employees’ Retirement System selected Pacific Urban Residential as the manager of a new multifamily fund, providing $200 million in an initial allocation to buy Class B multifamily properties in western U.S.
The new fund in April bought the 147-unit Citra apartment complex in Sunnyvale at 745 S. Bernardo Ave., paying $50 million, or $340,000 per unit, according to the Registry.
In Palo Alto, average rents for all apartment types were $3,035, up 15.1 percent from a year ago, according to the first-quarter RealFacts rent stats. (Second quarter numbers are not yet final.) A studio will set you back $1,905, up 12.3 percent year over year, first time the price point has crossed $1,900 a month.
According to the listing, Park Towers (which is really just one six-story building), is fully leased, with rents that are “significantly below market, providing a repositioning investment opportunity for market rate or student housing.”
Pacific Urban, headquartered in Palo Alto, has acquired more than 20,000 apartment units totaling $3 billion on behalf of investors. It has four offices on the West Coast.