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December 23, 2020

Recent Sale Shows Some Apartments are Returning to Pre-Pandemic Pricing
By Les Shaver

While there is lingering concern about rent payments in the apartment sector, it is clear that many multifamily properties are trading at pre-pandemic pricing.

Need proof? Look at Equity Residential's recent sale of Vantage Pointe, a 679-unit apartment property located in downtown San Diego.

EQR sold the property for approximately $312.5 million at a disposition yield of 4.1%, which generated a preliminary unlevered IRR of 8.8% over the REIT's ten-year ownership period. Mark J. Parrell, Equity Residential's President and CEO, said that the company sold the asset at the price it had ascribed to it before the pandemic.

Overall apartments are reaching pre-pandemic metrics, including pricing. In fact, values for apartments improved in November, posting a 7.6% YOY increase, according to Real Capital Analytics. RCA says annual returns for the sector have hovered in the mid-7% range over the last few months. Read more.

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