Waterstone Millbrae offers one- and two-bedroom floor plans averaging 841 square feet. Community amenities include a swimming pool and spa, a cardio-fitness center, clubhouse and abundant parking. Located at 509 Poplar Ave., the property is approximately one mile from the Millbrae Caltrain/BART station and is close to interstate 280 and 380, and El Camino Real [State Route 82].

The listing brokers were multifamily specialists Stan Jones and Sal Saglimbeni, respectively executive vice president and associate vice president in M&M's Palo Alto office. Jones tells GlobeSt.com the Waterstone deal is "an affirmation of a trend in which people are looking very heavily toward the location and the physical plant—things we got away from in the Heyday when everyone was trying to garner yield regardless."

Jones, who has typically worked with large institutional buyers and sellers such as Wall Street investment banks and publicly traded real estate companies in recent years, says the buyer of Waterstone is also reflective of a trend. "Our transaction volume fell from 56 deals in 2007 to 28 deals in 2008 to probably 14 in 2009," Jones says. "Of those 14, probably 12 will be private-client driven."

In general, he says cap rates are trending downward due to "more definition in the market, fewer sellers and a decrease in interest rates." In addition to that, he says Millbrae generally garners a 75-basis-point cap rate premium compared to San Jose or Oakland because of its location on the San Francisco Peninsula.

"Despite this being one of the toughest economic periods in recent memory, well-located, well-maintained properties are continuing to drive strong interest among many buyers," says Jones. "Waterstone Millbrae satisfied both criteria."

Pacific Property was an active buyer up until late 2007; it has been selling ever since, having quietly unloaded 10 properties since that time, according to Real Capital Analytics. In addition to Waterstone Millbrae the company has sold five apartment properties in the past year, according to RCA, three in Southern California and two in the Seattle area. The Seattle properties traded for more than Pacific Property acquired them for while the Southern California properties sold for less.

In July 2009, Pacific Property sold for approximately $5.5 million a 69-unit property in the Seattle area that it purchased in 1997 for $3.3 million. In December 2008, it sold for $30 million two properties in West Covina, CA--1828 E Thelborn St and 1829 E Workman Ave--that it acquired in November 2004 for approximately $37 million. In October 2008, it sold for $36.5 million a 135-unit property in Downtown Seattle that it acquired in September 2005 for $28.2 million. In September 2008, it sold for approximately $9 million a 72-unit property in Oceanside, CA, that it acquired November 2005 for $11 million.