The property is the nine-story, 37-unit Buena Vista Apartments at 75 Buena Vista Ave. East, an Art Deco complex that was built in 1931 and had not been on the market in 70 years. The locally based Mannion Trust, one of nine prospective buyers who made offers on the property, bought it for $6.8 million from the Stirling Family, which had acquired it from the original developer in 1931.

Devincenti explains that the cap rate was unusually low for today's market primarily because expenses at the building run higher as a result of its master-metered utilities, meaning that the building owner pays for the utilities. The buyer was willing to accept the lower cap rate in part because Devincenti explained to him that he will be able to increase rents and lower expenses within the next 12 to 24 months by understanding the rent control laws and measures that can be pursued to increase the NOI generated by the building.

For example, the rent control laws permit the new owner to convert the electrical system to individual unit metering, which will lower his expenses. Although the new owner will not be able to pass through electricity costs to existing tenants via the individual metering, he will be able to do so when new tenants move in. "We showed him that 43% of the building had turned over during the past 24 months, so if that pattern of turnover continues, he will be able to shift the utility costs to the tenants," Devincenti says.