Behind the Deal with Stepp Commercial’s Mark Ventre
By Dennis Kaiser
Recently, Los Angeles-based Stepp Commercial completed the $2.13-million sale of Atwater Avenue Apartments, a six-unit, turnkey property in the Los Angeles submarket of Atwater Village. The transaction also marked a record-breaking sale as the property achieved the highest price per unit of $355,000 and highest price per square foot of $461 ever paid for comparable properties in the submarket. Connect Media asked Stepp’s Mark Ventre to go behind the deal in our latest 3 CRE Q&A.
Q: Why is Atwater Village becoming a more attractive rental market?
A: Over the last several years, Los Angeles’ northeast area has increased considerably in popularity among Angelenos. As residents get priced out of the trendier places like Echo Park, they are pushing out into places like Atwater Village, which has now become very trendy itself. Its quiet suburban tree-lined streets and central location is just blocks from Glendale, Los Feliz and Silver Lake, and minutes to Burbank, Pasadena, Hollywood and Downtown LA.
Q: What can sellers do to make their assets secure a top sales price?
A: The best thing sellers can do to their assets is spend the extra money to renovate to a luxury high-end finish for unit interiors, exterior façade and common areas. Tenants notice the attention to detail and it ends up making a significant difference to the property’s desirability and the sellers’ bottom line. Having a turnkey stabilized asset without differed maintenance for which no expenses were spared commands a premium.
Q: Do you see rents in LA’s emerging submarkets like Atwater Village continuing to rise?
A: Most certainly. In Los Angeles there is a ‘perfect storm’ of unbalanced supply and demand for rentals. High barriers to entry for development, unaffordability of single family homes, a forthcoming influx of Baby Boomers that are downsizing, and the new Generation Z just entering the rental market are all key factors. There is no place for rents to go but up, especially for gentrifying locations adjacent to high rent submarkets.
For comments, questions or concerns, please contact Dennis Kaiser