Search
 

What’s Causing SD’s Multifamily Cap Rates to Dip?

SAN DIEGO—Significant pent-up demand for apartments in a market that only transacts on average 18 trades a year over 100 units is creating a market where cap rates are among the lowest in the nation, CBRE’s Rachel Parsons tells GlobeSt.com.

Rachel Parsons Parsons: “There are numerous buyers for every transaction; the challenge is finding sellers.”

SAN DIEGO—Significant pent-up demand for apartments in San Diego, which only transacts on average 18 trades a year over 100 units, is creating a market where cap rates are among the lowest in the nation, CBRE VP investment properties, multifamily, Rachel Parsons tells GlobeSt.com. A recent report from the firm showed that, among stabilized class-A infill multifamily assets, Los Angeles and San Diego were among the markets with the lowest cap rates in the nation at 4%.

The report also revealed that California leads the country with the lowest suburban cap rates for multifamily. A shortage of multifamily housing, a growing economy and a large renter population are all contributing to strong multifamily supply/demand fundamentals. These strong economic and demographic factors are fueling investor sentiment, which has driven cap rates to record lows.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Carrie Rossenfeld

Carrie Rossenfeld

Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.

More from this author

Recommended Stories

GlobeSt. Multifamily Spring 2025Event

Join the industry's top owners, investors, developers, brokers & financiers at THE MULTIFAMILY EVENT OF THE YEAR!

Get More Information
 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.