13266 Foothill Blvd, Sylmar

the successful sale of 28 units located at 13266 Foothill Blvd in Sylmar, California. This pocket of Sylmar is one of the most rapidly improving areas of the East San Fernando Valley and is home to a number of new exciting developments. The most exciting of which being the new East San Fernando Valley LRT (Light Rail Transit) project which will include 14 on-grade stations arranged to easily connect the East and West Valley, and allowing easy connections to Westside cities and DTLA.

The subject property, built in 1985, sits on a 23,920 SqFt lot (0.55 Acres) with a total building area of 28,285 SqFt, and presented the buyer a great unit mix of (6) 1-Bed / 1-Bath units and (22) 2-Bed /2-Bath units. The property is not subject to LA rent control, but it is subject to California's newly adopted AB-1482 where the landlord can increase rents by 5% + CPI on an annual basis.

DEAL STORY

We listed this property just over two months ago in early March 2021 for $7.5M. With our unmatched marketing platform, we were able to generate multiple offers within the first two weeks of marketing.

The Seller had a large prepayment penalty on his loan with Chase Bank, however we were able to find a buyer who was willing to assume the seller's current loan, which saved the seller approximately $130,000 in prepayment penalties. We even had higher offers than $7,300,000, but those buyers did not want to assume the seller's loan, which meant those higher priced offers were actually lower for the seller's net proceeds.

During the buyer's due diligence, the buyer's inspector found a laundry list of deferred maintenance items (to be specific, there were 20 items that the inspector recommended to be fixed). However, since we were able to generate multiple offers and create competition and pressure on the buyer to perform, we were able to negotiate that the seller only had to replace one water heater that was broken, and the Buyer would take care of the remaining 19 issues after close of escrow. There was no credit or price reduction during escrow.

The final issue that came up during escrow (since every deal has their surprises), was that a disgruntled tenant decided to file a lawsuit against the Seller due to unrelated items to the sale. Because of this, we had to negotiate an indemnity contract between Buyer and Seller so that we could move forward with a close without the Buyer having to worry about any legal battles with his new tenant.

After we had that tenant issue...