Sale of Historic Apts Tops Asking Price

VENICE, CA-The Oceanview Apartments, a historic building originally developed as a hotel in 1905, has sold for $300,000 more than the asking price for the property. Sperry Van Ness brokers who negotiated the Oceanview sale report that the property, which is adjacent to Pacific Coast Highway at 5 Rose Ave. on the Venice Boardwalk, sold for $10.8 million.

More than 20 prospective buyers made offers on the building, which was renovated in 1972 for apartment and retail uses, including retail on the ground floor and basement levels. The buyer was a Los Angeles-based private investor who acquired the property from Encino-based Urbatec in a deal that went from listing to close of escrow in 60 days.

Both Urbatec and the buyer were represented by Brent Sprenkle, Geoff Tranchina, Jereme Snyder and Tim Steuernol of Sperry Van Ness in Los Angeles. The property was 88% occupied at the time of the sale and includes 59 apartment units, all with ocean views, with rents ranging from $827 to $1,600. The sales price works out to $369.10 per sf, with the ground-floor retail space vacant at the time of the sale.

Venice is one of a number of communities composing a Westside Los Angeles multifamily market where demand and prices remain among the strongest in the Los Angeles Basin, according to recent market reports. Despite the relative lack of land for development on the Westside, builders are finding places to develop and are expected to complete about 500 or 600 new units on the Westside this year.

Combined with the traditionally intense demand for all kinds of housing on the Westside, the tight development market has contributed to continued rising prices in the submarket, where cap rates have dipped to some of the lowest in the region, according to the market reports. The various reports peg the cap rates at the mid-4% range to the low 5% range.