When eyeing recent multifamily transaction activity in the Bay Area two counties, Santa Clara and Alameda, stand out.
During the fourth quarter of last year Santa Clara County accounted for the highest multifamily sales volume (nearly $795 million), while Alameda contributed the most rental property sales (83), according to a report from Cushman & Wakefield.
In Santa Clara, the closing of 40 transactions accounted for the $795 million in sales volume last quarter. Five of these transactions represented $610 million of the $795 million.
These five deals, which ranged in sales price from $93 million to $160 million, likely involved newly built multifamily developments, as the sellers were Pacific Urban Residential, Braddock & Logan Homes, Lennar Multifamily Communities, J.F. Shea Co. and Fairfield Residential.
These transactions are the primary reason the county’s average price per-unit, for multifamily units sold, reached $424,000 last quarter.
Average rents in Santa Clara, which sat at $2,575 last quarter, are predicted to modestly increase in the months ahead. The county has roughly 7,800 rental units currently under construction and an average vacancy rate of 4.7 percent.
Alameda County attracting renters, investors
Population growth, an average vacancy rate of 3.3 percent and a minimal rental development pipeline are the primary reasons multifamily owner/operators are buying properties in Alameda County.
Last quarter 83 multifamily transactions closed, which equated to $371 million worth of deals. Contributing to this volume total was the sale of a 544-unit property for $158 million. The buyer was Phoenix Realty Group.
Ranking among the fastest growing counties in California, with large levels of in-migration occurring, rapid rental rate growth is expected to continue in Alameda, as only 2,824 rental units are under construction. Of these units, a large concentration are in downtown Oakland and Jack London Square.
During the fourth quarter the average rent in Alameda, at properties with 50 or more units, stood at $2,226.
