The Setup
Built in 2022. Valley Glen sits between Van Nuys and North Hollywood.
The 68 units: standard 1+1s, penthouse 1+1s, low-income 1+1s, standard 2+2s, penthouse 2+2s, one low-income 2+2, standard 3+2s, and penthouse 3+2s. Average unit size runs 982 SF across the mix.
The garage is gated with 27 EV charging stations
The Math the Broker Is Pitching
The broker states a 5.51% current cap on $1,262,112 NOI and projects a 6.06% market cap on a proforma NOI that implies roughly $2,029,908 in gross revenue against a 34% expense ratio. The gap between current and market gross is $132,927 per year, or about $165/month per market-rate unit on average. That is the rent growth a buyer needs to capture to close the spread from a 12.07 current GRM to the 10.89 market GRM the broker is pitching.
| Scenario | Gross Revenue | NOI (34% exp.) | Value at Ask | Implied Cap |
|---|---|---|---|---|
| Current (stated) | $1,896,981 | $1,252,408 | $22,900,000 | 5.47% |
| Market (broker proforma) | $2,029,908 | $1,339,739 | $22,900,000 | 5.85% |
| 6.00% cap target | $2,029,908 | $1,339,739 | $22,329,317 | 6.00% |
The question is whether the market rents the broker projects, averaging $2,250 for standard 1+1s and $2,995 for 3+2s, are achievable at stabilized occupancy without concessions eating the margin.
What an Operator Sees
This deal comes down to one question: can the next owner actually get the rents the broker is underwriting?
At $22.9 million, the basis is about $337,000 per unit for a 2022-built, non-RSO asset. Current operations produce roughly a 5.5% cap. The broker’s 6.06% market cap is from raising rents and doesn't need renovation so that is a good sign.
The underwriting requires the 64 market-rate units to move roughly $179 per month on average. That is about $2,150 more revenue per unit per year. If Valley Glen supports those rents without concessions or vacancy, the deal starts to make sense.
That is what makes this interesting to me. There is very little construction risk here. The bet is rent execution. You are buying relatively new construction at $337K a door and below Replacement Cost.
The four restricted units matter because there is upside left in the future but could take a long time.
Exclusively Listed By:
The property is exclusively listed by Glen Scher and Filip Niculete of Marcus & Millichap’s Encino office, both Senior Managing Directors Investments. The team is marketing the 68-unit Valley Glen asset at $22.9 million, or approximately $337,000 per unit, positioning the opportunity around its newer 2022 construction, non-RSO status, and potential upside in the existing rent roll.
I spoke to Filip and he said “This is a rare chance to buy newer construction in the Valley below replacement cost and with no rent control. Full utility bill-back insulates ownership from rising expenses, and the subterranean parking, EV charging, and rooftop deck drive rent premiums that older product in the submarket can’t touch.”
I am tracking where this trades. If a buyer is willing to pay near $337K per door and underwrite a 6% stabilized yield here, that is a useful data point for where capital is valuing newer, non-RSO Valley apartments today.
I research these transactions to sharpen my own investment strategy and share what I find so Los Angeles owners, brokers and investors can debate the market with better information.
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Property and transaction data: CoStar Research.