346 N Gardner St, Los Angeles

and Deal Story

The LAAA Team of Marcus & Millichap is pleased to announce the successful closing of 346 N Gardner St, a 4 unit multifamily property located in the heart of the Beverly-Fairfax Historic District.

Property Overview

Built in 1930, this beautiful Spanish-style building sits on a 0.15 acre corner lot, and the building's 5,302 square feet is equally split into four 2 bed / 1 bath units, with an estimated unit size of 1,325 square feet for each unit. Also, the property has 4 private 1-car garages, one for each tenant to use. The owner of this property, who bought this building nearly 44 years ago, is delivering the property with 3 vacant units and allowing the next owner to remodel the units to their liking.

Record Sale

This sale is the 4th highest price ever achieved in the 90036 zip code for a 4-unit apartment building. The three higher sale prices were fully renovated properties (346 N Gardner was not renovated), and they all sold in a better market before interest rates were raised. We are now responsible for 2 of the top 5 sales on this list with our previous listing at 854 S Sycamore that closed earlier this year (#5 below).

Deal Story

The seller first reached out to us in June 2022 after he saw that we closed on a similar 4 unit building at 854 S Sycamore for a great price. After 44 years of ownership, he was ready to sell and asked us for our opinion of value. The seller told us that he's planned on selling this building for 5 years, and he wisely left units vacant as there was natural turnover. He never "bought out" tenants through a cash-for-keys agreement, and he didn't renovate the units as they became vacant. He just cleaned them up and left them vacant waiting for the right time to sell. Once he had 3 of the 4 rent-controlled units vacant, he decided it was time.

When the seller reached out to us in June, the market was beginning to change. The Fed had just implemented their 3rd consecutive rate hike which was starting to affect property values. The seller told us he was expecting close to $3 million for his property because he followed the market closely, and he also knew that his 3 vacant units carried a ton of value. When looking at recent comparable sales, his value was not too far off, but the issue was that even the most recent comparable sales (those that sold in the past couple months) were not exactly comparable anymore due to the rapidly changing interest rate environment. After running the numbers, we advised...