Property in Alpine trades hands at $207,627 per unit
A 59-unit apartment complex in Alpine, California, has sold for $12.25 million, marking another multifamily transaction in San Diego County’s competitive rental market.
Alpine Terrace Apartments, built in 1978, features a mix of one and two-bedroom townhouse-style units spread across a 2.9-acre parcel. The sale closed at approximately $207,627 per unit, with the property trading at a 5.51 percent capitalization rate and 9.3 gross rent multiplier.
The low-density garden walk-up property, located at 1440 Olivewood Ln., is positioned as what brokers describe as a “limited risk investment” with potential for 15 percent rental upside. Located roughly one mile south of Interstate 8, the complex offers access to major transportation corridors while maintaining a suburban feel in the East County community.
Jon Mitchell, senior vice president at Kidder Mathews, represented the transaction. The brokerage highlighted the property’s “excellent unit mix” and spacious floor plans as key selling points, along with amenities including a pool, barbecue area, and leasing office.
At $274 per square foot, the sale reflects continued investor confidence in San Diego County’s multifamily market, despite broader economic headwinds affecting real estate sectors nationwide. The property’s 1978 vintage places it in a category of assets that often appeal to value-add investors seeking to implement capital improvements and rental increases.
The Alpine Terrace sale occurs within a broader San Diego County multifamily market that continues to demonstrate resilience in 2025. San Diego ended 2024 with overall balanced fundamentals, with most metrics falling back to historic levels. Average advertised asking rents in the metro were $2,744 through December, up 0.5 percent year-over-year, while overall occupancy in stabilized assets remained healthy at 96.1 percent.
The San Diego multifamily market remains strong and stable at the start of 2025. Forecasts show vacancies holding steady at 4.5 percent, according to Moody’s. That’s tighter than the national average, 6 percent. Asking rents are projected to rise 2.5 percent year over year—stronger growth than the market saw in 2024.
The Alpine Terrace transaction’s 5.51 percent cap rate aligns with recent market trends. As of 2025, San Diego multifamily properties continue to trade at compressed cap rates, with recent sales averaging 4.3 percent to 4.6 percent, notably lower than the 6.0 percent national average. However, recent trends suggest a softening in prices within the San Diego multifamily market, with most sales comparables showing final sold cap rates generally higher than initial asking cap rates, indicating that sellers are having to adjust their expectations.
The multifamily investment sales market in San Diego posted improving conditions in the fourth quarter. While transaction volume during the first half of the year was light, activity picked up significantly to close the year. The median price in 2024 was $361,500 per unit, up 36 percent from the 2023 figure.
The market’s resilience stems from fundamental economic strength. San Diego’s area median income reached $119,500 in 2024, marking a significant 38.5 percent increase in incomes since 2019. Concurrently, the region’s GDP has surged by 20 percent over the past two years, approximately four times the national growth rate.
San Diego’s median home price surpassed the $1 million mark last year — a milestone that will limit housing options for a large percentage of the local populace in 2025. Together with sub-5 percent vacancy, these factors will facilitate strong near-term demand across the multifamily spectrum.
San Diego is expected to see another year of heightened construction, with more than 2,800 new apartments, according to Moody’s. That will pressure near-term apartment market performance, but the challenging homebuying environment should help rebalance the market’s supply and demand.
Class B and Class C properties have traditionally fueled the investment market, accounting for more than 80 percent of transactions since 2018, and these property groups are likely to have the strongest rent gains and tightest vacancies in 2025.
The Alpine submarket, while more affordable than coastal San Diego communities, has seen increased investor interest as buyers seek higher-yielding opportunities in areas with potential for long-term appreciation. The property’s townhouse configuration and garden-style layout offer a residential feel that can command premium rents compared to traditional apartment complexes.
With central heating and air conditioning throughout, Alpine Terrace represents the type of stabilized asset that institutional and private investors have targeted in secondary markets across Southern California. The current ownership positioned the sale as offering “strong long-term value appreciation” potential in addition to immediate cash flow returns.
The transaction adds to a growing roster of multifamily sales in San Diego County, where rental demand remains robust despite broader market volatility. Properties offering value-add potential and stable cash flow continue to attract capital from investors seeking alternatives to more expensive coastal markets.
