“Parkview Apartments”
CASE STUDY – 342 N Garden Drive, Vancouver
The Property
Parkview Gardens is a well-managed rental complex that has been with the same ownership group for over 40 years. Originally constructed in 1967, it is comprised of a 3 storey – 12 unit apartment building that has ample surface parking and is situated on a well-located 8,195 sf lot. Located in a region with rising rents, a strong local economy, and a growing population; the complex offered investors a current stable cash flow with revenue upside upon tenant turnover.
The Challenge
The owners of the complex had attempted to sell the property a number of times throughout the years. It was listed on MLS® (a tool many agents use), and with a variety of well-known real estate companies. As the building has been owned by the same group for a number of years, it had minimal annual rental increases, resulting in a rental income that was extremely low. The property was always priced slightly above the market, and although the upside was huge; once the property was exposed on MLS for a length of time, the property became stigmatized.
Strategy
After considering the previous variables; we decided that a more direct approach was needed. The first step was to list the property exclusively to create a sense of urgency and prestige. With a history on MLS®, the previous activity would likely hinder market attention. We don’t work under the wait and see approach; in addition to extensive advertising, we actively reached out to buyers in our database, and to all capable multifamily owners already operating buildings in the price range throughout BC. With interest rates high, market activity was low, however an investor was found that was looking to expand their portfolio.
Results
The property was under contract and firm in less than 8 weeks and sold for 93% of asking. This resulted in achieving over $307,000 per door at a cap rate of 3.7%; a record level cap for the year in the nearby region. The past owner is extremely pleased, and can now focus on other investments.
