Monday, February 8, 2010

4th Quarter 2009 Hollywood Multifamily Sales: Foreclosures and Short Sales Dominate Market

Foreclosures and short sales drove the Hollywood income property market during the 4th Quarter of 2009. 10 of 13 sales were distressed properties and 11 of 13 of them sold for $670,000 or less. It is difficult to evaluate this market in terms of traditional investment property metrics since nearly all are value-added opportunities.

1811 Wilcox HollywoodThe highest sale was 1811 Wilcox Avenue, a vacant 12 unit building (8 singles, 4 two-bedrooms), which closed at $1,475,000. This fixer in central Hollywood shows that investors often see more value in vacant buildings rather than occupied ones saddled with below-market rents.

1807 Grace Ave Hollywood1807 Grace Avenue, an 8 unit building (4 singles, 4 one bedrooms) sold for $1,115,000. Annual income is $104,643, giving a GRM of 10.7.

4327 Burns Ave Hollywood4327 Burns Avenue shows the kind of value-added opportunity that investors are seeking. This 8 one-bedroom bungalow complex from the 1920s in East Hollywood has lots of deferred maintenance and sold for $550,000. But with $73,872 in annual income, the Gross Rent Multiplier is 7.5, far below any comparable property.