5642 Lexington Ave, Los Angeles, CA 90038

Property Description

Price Reduction! Large 6,094 SF, 8-unit value-add apartment building in the heart of Hollywood, offering strong day-one cash flow at a current 5.25% cap rate with upside to approximately 7.6% on pro forma rents. Attractively priced at only $243,000 per unit and $319/SF, the property offers a diverse unit mix of 6 spacious one-bedroom units and 2 two-bedroom units. The building sits on a large 7,099 SF LAR3 lot, with plans to add 8 detached ADUs, potentially doubling the property's unit count. Assuming $715,000 in ADU construction costs at $250/SF, the projected all-in basis is only $160,000 per unit and $286/SF, with a 9% cap rate on current rents and 10.9% on pro forma rents after completion. Most recently, the front upstairs unit was completely remodeled with a high-end modern aesthetic, featuring new cabinetry, vinyl flooring, recessed lighting, a renovated bathroom, an updated HVAC system, an in-unit washer/dryer, and additional upgrades. The property's exterior has also undergone extensive renovations and features approximately 9 on-site parking spaces, storage, and an updated laundry room. Gas and electricity are metered separately, helping to minimize owner-paid operating expenses. Prime Hollywood location directly behind Echelon Studios Hollywood, an approximately $450 million, 610,000 SF creative entertainment campus located on a five-acre site at 5601 Santa Monica Boulevard, and just blocks from Netflix and Paramount Studios, placing the property in the heart of Hollywood's entertainment and media district.