Wilshire Vermont Station Apartments (“Wilshire Vermont”) is a mixed-use, transit-oriented development consisting of 449-units and 37,000 sq. ft. of ground floor retail space located above the Wilshire/Vermont metro station in Koreatown, Los Angeles. ​ The property’s construction was partially financed through proceeds from the sale of tax-exempt bonds, offering extremely attractive and assumable interest-only debt at a fixed rate of 1.567%, allowing a buyer to generate above-market cash returns by locking in a historically low rate more than 300 basis points below conventional financing.

Lease trade-outs are currently averaging 19% on new move-ins and renewals, and newer properties within walking distance are proving out +$600 of headroom in rents, offering investors an opportunity to drive rents through property and unit interior upgrades. ​ The property is also offered at a significant discount to replacement cost in an escalating cost environment that is making future development infeasible with current rents and land prices.

Like many in-fill, transit-oriented developments in Los Angeles, Wilshire Vermont was developed on land owned by the LA County Metropolitan Transportation Authority (“MTA”), with 81 years remaining on the current lease and a fixed ground lease payment, subject to certain adjustments every five years.

This is an exceptional opportunity to generate above-market going-in cash returns with historically low, assumable financing, and renovate a 2008-vintage asset at a significant discount to replacement in a market appealing to young professionals, millennials and those seeking a vibrant urban lifestyle.