3444 Emerald St: With 21% Rent Upside Still on the Table
With rents running 21% below market and a 171 basis point spread between the going-in and market CAP rate.
Built in 1962 on a 22,228-square-foot lot. It is priced at $5,699,999, or $285,000 per unit, with in-place rents that sit meaningfully below what comparable units in the area are commanding today.
Address | 3444 Emerald St, Torrance, CA 90503 |
Units | 20 (6 2BD/1BA, 13 1BD/1BA, 1 Studio) |
Year Built | 1962 |
Building Size | 16,201 sq ft (approx. gross RSF) |
Lot Size | 22,228 sq ft (0.51 acres) |
Asking Price | $5,699,999 |
Price Per Unit | $285,000 |
Current CAP Rate | 4.34% |
Market CAP Rate | 6.05% |
Current GRM | 12.45 |
Market GRM | 10.20 |
Rental Upside | 21% |
The unit mix is six 2-bedroom/1-bath units, thirteen 1-bedroom/1-bath units, and one studio, spread across roughly 16,201 rentable square feet. Tenants pay their own gas and electric, and the property includes a pool and rear parking. Current average rents run from $1,750 for the studio up to $1,892 for the two-bedrooms, all below what similar units in the submarket are leasing for today.
- 6 two-bedroom, one-bath units
- 13 one-bedroom, one-bath units
- 1 studio unit
- Pool on site, tenant-paid gas and electric
- 22,228 square foot lot (0.51 acres), built 1962
At $5,699,999, the property runs a 4.34% CAP rate on current in-place rents. Push those same units to market rent and the CAP rate moves to 6.05%, a spread of roughly 171 basis points. The GRM tells the same story from a different angle: 12.45 on current rents, compressing to 10.20 at market. Scheduled gross income today is $457,665 a year against a market potential of $558,600, a 21% gap.
Proposed financing is a $2,850,000 loan (50% down) at 5.75%, amortized over 30 years, penciling to a 1.24 debt coverage ratio. On current rents, that puts pre-tax cash flow at 1.67% of the down payment. At market rents, that climbs to 5.11%, with total return before taxes moving from 2.96% to 6.39% once the rent gap closes.
4.34% CAP rate today, with a path to 6.05% as rents reach market. Total return before taxes moves from 2.96% to 6.39% along the way.
The property sits in Torrance's Delthome neighborhood, with quick access to major freeways and close proximity to schools, shopping centers, and restaurants. The South Bay's beaches are roughly a 15 minute drive away, and El Camino College sits just a few miles out, a combination that has kept this pocket of Torrance a steady rental market.
3444 Emerald St tells the same story from two angles. For buyers, it's a building with real upside still on the table. For owners nearby, it's a live example of what your own property could be worth once the numbers are run.
That's where Jack McCann Multifamily Advisors comes in. No pitch first, just the numbers: for buyers, where a deal like this stands against market. For owners, where your rents and expenses stand today, and what your building could be worth once it catches up. No obligation, no assumption about which way you'll go. Sometimes holding steady is right. Sometimes it's time to sell and trade up. Sometimes it's time to buy before pricing like this gets harder to find. Either way, the goal is clarity, built on analysis run across hundreds of properties throughout Los Angeles and Southern California.
If you own a multifamily property and want a clear read on where your income and value could grow before deciding whether to sell, request a Stress Test. Only ten spots open each month, and they fill quickly, so it's worth locking one in now.
Interested in 3444 Emerald St, or curious what a building like it could mean for your portfolio? Reach out anytime.
Figures sourced from the property operating memo presented by Lyon Stahl Investment Real Estate. Information is secured from sources believed reliable but not warranted; square footage, lot lines, and age are approximate. Buyers should independently verify all information.
