Walker & Dunlop Arranges Second Largest Single-Asset Sale in California and Fifth Largest Nationwide in 2024

Rhea-AI Summary

Walker & Dunlop has arranged the $167,000,000 sale of Millennium PQ, a 331-unit multifamily community in San Diego's Rancho Penasquitos neighborhood. This transaction marks the largest suburban core sale and second-largest single-asset sale in California, as well as the fifth largest nationwide in 2024. The sale price equates to $504,532 per unit.

The property's location near top employment hubs, including Apple's future campus, and its high-end amenities contributed to its attractiveness. San Diego's market strength is highlighted by consistent rent growth and the influx of life science and tech companies. Walker & Dunlop's Investment Sales team represented both the seller and buyer in this significant transaction.

Positive

• Arranged $167 million sale of Millennium PQ, second-largest single-asset sale in California
• Sale price of $504,532 per unit, indicating strong property valuation
• Property located in sought-after neighborhood near major employment hubs
• San Diego market shows consistent rent growth and attractiveness to investors
• Walker & Dunlop completed over $51 billion in property sales volume since 2021

Negative

• None.

Insights

Financial Analyst

The sale of Millennium PQ for $167 million is indeed significant, representing one of the largest transactions in both California and nationwide. The price per unit of $504,532 is noteworthy, indicating a high demand for quality suburban multifamily assets. This is an attractive metric for investors and showcases the financial viability of such properties.

From a financial perspective, this transaction underscores San Diego’s strong rental market, driven by its consistent rent growth and diversified employment base. The fact that San Diego captures a significant portion of U.S. multifamily transactions over $150 million highlights the city's desirability among institutional investors. This resilience is further supported by the presence of major industries including life sciences, tech and defense.

It’s important to consider the macroeconomic context here too. As the Federal Reserve’s interest rates remain high, real estate investment can provide a hedging opportunity against inflation, driving interest in stable, high-performing markets like San Diego.

For retail investors, this transaction reaffirms the strength of the multifamily market in key regions, making it a sector worth monitoring. However, high unit prices may indicate a peak in valuations, suggesting careful consideration before entering at such elevated levels.

Market Research Analyst

The sale of Millennium PQ highlights several key market dynamics. Firstly, the geographic location in Rancho Penasquitos puts it in a top-performing submarket, fueled by high-quality education systems and proximity to major employment hubs, including tech and defense sectors. This ensures a steady demand for housing, which is an attractive feature for investors.

Secondly, the property’s high-end finishes and resort-style amenities align with current market trends favoring luxury and lifestyle-oriented living spaces. This type of development typically attracts higher-income tenants, ensuring more stable and higher rental yields.

Investor interest is likely further piqued by the upcoming Apple campus, which will drive employment growth and demand for housing in the area. The inclusion of such high-profile developments helps in maintaining property value appreciation over the long term.

Retail investors should note that buying into such high-value markets typically offers lower risk but also lower immediate returns. Investments in these areas are generally more about long-term capital appreciation rather than quick gains.

BETHESDA, Md.--(BUSINESS WIRE)-- Walker & Dunlop, Inc. announced today that it arranged the $167,000,000 sale of Millennium PQ, a trophy suburban core multifamily community comprising 331 units in Rancho Penasquitos, one of San Diego’s most sought-after neighborhoods.

Millennium PQ (Photo: Business Wire)

This sale marks the largest suburban core transaction and second-largest single-asset transaction in California, as well as the fifth largest nationwide in 2024. The purchase price translates to an impressive $504,532 per unit.

The Walker & Dunlop Investment Sales team, led by Hunter Combs, represented the seller, The Dinerstein Companies, and the buyer, GID Real Estate Investments.

“San Diego remains a top institutional metro, with 13 percent of the total U.S. multifamily transactions exceeding $150 million and 26 percent within California 2023 year-to-date,” said Hunter Combs, managing director of Investment Sales at Walker & Dunlop. “San Diego's market strength is propelled by its historically consistent rent growth and the influx of life science surrounding UCSD and big tech companies establishing their presence here, in addition to the long-standing defense industry. This dynamic underscores San Diego's exceptional market resilience and its attractiveness to investors.”

Located in the Rancho Penasquitos submarket of San Diego, Millennium PQ benefits from being situated in one of the county's top school districts and within minutes from San Diego’s top employment hubs, including Apple’s future 68-acre campus. The property features high-end finishes and resort-style amenities in a serene, low-density garden-style setting. It stands out as one of only two core institutional assets in Rancho Penasquitos and one of just five within a 10-mile radius.

Walker & Dunlop is a leader in multifamily property sales, having completed over $51 billion in property sales volume since 2021. The firm is also one of the top providers of capital to the U.S. multifamily market. In 2023, Walker & Dunlop originated over $24 billion in debt financing volume, including lending over $20 billion for multifamily properties. To learn more about our capabilities and financing options, visit our website.

About Walker & Dunlop

Walker & Dunlop (NYSE: WD) is one of the largest commercial real estate finance and advisory services firms in the United States. Our ideas and capital create communities where people live, work, shop, and play. The diversity of our people, breadth of our brand and technological capabilities make us one of the most insightful and client-focused firms in the commercial real estate industry.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240716337181/en/

Investors:

Kelsey Duffey

Investor Relations

Phone 301.202.3207

investorrelations@walkeranddunlop.com

Media:

Nina H. von Waldegg

VP, Public Relations

Phone 301.564.3291

info@walkeranddunlop.com

Phone 301.215.5500

7272 Wisconsin Avenue, Suite 1300

Bethesda, Maryland 20814

Source: Walker & Dunlop, Inc.

FAQ

What was the sale price of Millennium PQ arranged by Walker & Dunlop (WD)?

Walker & Dunlop arranged the sale of Millennium PQ for $167,000,000.

How many units does the Millennium PQ property in San Diego have?

Millennium PQ comprises 331 multifamily units.

What is the per-unit price for the Millennium PQ sale arranged by Walker & Dunlop (WD)?

The sale price translates to $504,532 per unit.

How does the Millennium PQ sale rank in California's real estate transactions for 2024?

It is the second-largest single-asset transaction and the largest suburban core transaction in California for 2024.

What was Walker & Dunlop's (WD) property sales volume since 2021?

Walker & Dunlop completed over $51 billion in property sales volume since 2021.