California CRE News In Your Inbox.

Sign up for Connect emails to stay informed with CRE stories that are 150 words or less.

Sub Markets

Property Sectors


California  + Finance  | 

3 CRE Q&A with Stepp Commercial: Santa Monica Multifamily

By Dennis Kaiser

Stepp Commercial continues to record high volumes of multifamily transaction activity in the Santa Monica market. Three recently completed sales involve a $2-million, 6-unit asset on 17th St., a $2.7-million, 6-unit property on 20th St., and a $2.45-million, 7-unit asset on Yale St. These representative transactions range from value-add investment plays to 1031 exchanges, and reflect just how insatiable demand is for high-quality apartments in the Santa Monica market. Stepp Commercial’s Kimberly Roberts Stepp shared insights into what’s fueling that activity in the latest installment of Connect Media’s 3 CRE Q&A.

Q: Are you seeing more or less offers on Santa Monica multifamily properties now, as compared to earlier this year?

A: We are seeing a marked decrease in the number of offers that are presented with our new inventory compared to six months ago. Sellers are still eager to get elevated peak pricing, but a looming fear is that they might have missed the boat. Santa Monica has a lot of older product with generational tenants in place, and the suppressed capitalization rates are hard to swallow for many buyers. With that said, although there may be less offers, we are still seeing strong offers from savvy investors who understand the market. They are still able to make incredibly aggressive returns even when buying at sub 3% capitalization rates.

Q: Are you seeing mostly cash buyers, or are deals being financed?

A: Most of the deals we have done over the past two years have been financed. With rates where they are, it is almost silly not to take advantage of the historically low cost of money that is available currently. There are still cash buyers in the marketplace, however, and they are the most competitive in getting the best deals with sellers that want to be assured of a quick close of escrow.

Q: Are there a lot of off-market deals happening here?

A: In this competitive market with limited inventory, we are seeing a marked increase in off-market deals.  Brokers, and even buyers themselves, are on the phones and aggressively pushing offers to sellers who are “on the fence” about selling or are not quite ready to list on the open market. The price levels being offered are peak pricing, and there is a large percentage of sellers agreeing to these off-market offers, closing transactions without formal marketing and exposure.

Connect Apartments is just around the corner on Sept. 15th in DTLA. Register today to learn more about what’s happening and connect with the best in the multifamily sector.

For comments, questions or concerns, please contact Dennis Kaiser


Inside The Story

Connect with Stepp Commercial’s Roberts Stepp

About Dennis Kaiser

Dennis Kaiser is Vice President of Content and Public Relations for Connect Commercial Real Estate. Dennis is a communications leader with more than 30 years of experience including as a journalist and in corporate and agency marketing communications roles. He is responsible for Connect’s client content operations and is involved in a range of initiatives ranging from content strategy, message development, copywriting, media relations, social media and content marketing services. In his most recent corporate communications roles, he led a regional public relations effort across Southern California for CBRE, played a key marketing role on JLL’s national retail team, and was responsible for directing the global public relations effort at ValleyCrest, the nation’s largest commercial landscape services company. In addition to his vast commercial real estate experience, Dennis has worked on communications and launch strategies for a number of residential projects such as Disney’s Celebration in Florida, Ritter Ranch in Palmdale California (7,200 homes, 22,000 acres), WaterColor in Florida and PremierGarage in Phoenix. Dennis’s agency background included firms such as Idea Hall and Macy + Associates. He has earned an outstanding reputation with organization leaders as a trusted advisor, strategic program implementer, consensus builder and exceptional collaborator. Dennis has developed and managed national communications programs for Fortune 500 companies to start-ups, both public and private. He’s successfully worked with journalists across the globe representing clients involved in major-breaking news stories, product launches, media tours, and company news announcements. Dennis has been involved in a host of charitable and community organizations including the American Cancer Society, Easter Seals, BoyScouts, Chrysalis Foundation, Freedom For Life, HOLA, L.A.’s BEST, Reach Out and Read, Super Bowl Host Committee, and Thunderbirds Charities.

  • ◦Financing
  • ◦Sale/Acquisition