“Interestingly, aggressive buying from exchange buyers has pushed well-capitalized local players to the sidelines, at least for now, for the finest apartment properties in San Francisco,” said Lagomarsino. “This is a trend we believe will continue through 2018 and into 2019 as demand, pushed by the record-breaking influx of tech workers occupying new, dazzlingly designed high-rise creative office buildings, continues unabated.” 

The four sales were:

  • 144 Parnassus, a meticulously maintained, 18-unit corner apartment building located in Cole Valley that sold for $7,875,000, some $675,000 over the original asking price. This transaction is one of the highest prices paid per-square-foot for a property with more than 10 apartment units. The private buyer, who maintains a sizeable San Francisco multi-family portfolio, sold a commercial lot in San Francisco and purchased a high-quality, multi-family asset to satisfy the exchange. Ryan Wagner, Brad Lagomarsino and James Devincenti of Colliers represented the buyer and seller in this transaction. This asset will remain in the family for decades, noted Lagomarsino. 

  • 1516 Larkin Street was purchased by a Peninsula-based investor who sold a mobile home park in the Central Valley of California. This trade-buyer accepted a 3.37 cap rate on the $5,840,000 purchase. of the property. There was a great deal of interest and multiple offers for this 13-unit asset, according to Devincenti.

  • 2665 Franklin Street is a 12-unit, corner apartment property that has been in the same family for more than 90 years. There were four offers on the property and it traded for $6,375,000, which was $736.31 per square foot and a 3.22 cap rate. Lagomarsino and Devincenti represented both the buyer and the seller.

  • 2642, 2648 and 2654 Gough consists of 18 one bedroom, one bath units with parking for 16 cars in the heart of Cow Hollow. The property sold for $9,950,000, which was $773.12 per square foot and a 4.04 cap rate. The buyer for these assets was in a 1031 exchange and sold a large syndicated deal in the Pacific Northwest as part of the transaction. Lagomarsino and Devincenti represented the buyer.

Lagomarsino claims that first quarter activity has seen 17 multi-family transactions in buildings with 10 or more units in the City, a phenomenal number for a three-month period. Pricing for these sales, he noted,  indicate that capitalization rates continue to compress per-square-foot prices, while per-unit prices continue to climb.  

“San Francisco remains one of the strongest markets in the country,” added Lagomarsino, “and these transactions, plus several others that are near-closing, demonstrate that no other multi-family market on the West Coast, or even in the U.S., comes close in comparison.”

About Colliers International Group Inc.
Colliers International Group Inc. (NASDAQ and TSX: CIGI) is an industry-leading global real estate services company with 15,000 skilled professionals operating in 68 countries. With an enterprising culture and significant employee ownership, Colliers professionals provide a full range of services to real estate occupiers, owners and investors worldwide. Services include strategic advice and execution for property sales, leasing and finance; global corporate solutions; property, facility and project management; workplace solutions; appraisal, valuation and tax consulting; customized research; and thought leadership consulting.

Colliers professionals think differently, share great ideas and offer thoughtful and innovative advice that help clients accelerate their success. Colliers has been ranked among the top 100 global outsourcing firms by the International Association of Outsourcing Professionals for 12 consecutive years, more than any other real estate services firm. Colliers also has been ranked the top property manager in the world by Commercial Property Executive for two years in a row.

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