David Weber, a senior associate in Marcus & Millichap's Washington, D.C., office who had the listing to market the property, says the acquisition price was low on a per-unit basis for Montgomery County because of Takoma Park's rent control laws.
"Because the amount you can raise rents every year is very low, it has a negative affect on buildings in that area," he tells GlobeSt.com. Ordinarily, a 20-unit building would be worth about $100,000 per unit, he says, instead of $80,000 per unit. The property was under contract when Montgomery County enacted its right of first refusal to buy it for its affordable housing program.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
