Q2 2012 Suburban Virginia, Virginia Apartment Property Sales Analysis

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Q2 2012 Suburban Virginia, Virginia Apartment Property Sales Analysis

Metro Volume and Pricing

Single-property investment transactions were again slow in the second quarter of 2012, Reis reports.* There were two transactions for $147 million at an average price of $198,000 per unit. Interestingly, that is the exact same number of transactions Reis recorded for the first quarter of 2012. Reis reports that so far in 2012, there have been four deals for a transaction volume of $341.1 million and an average sale price of $265,000 per unit. Leading the second quarter deals was the May transaction of the Commons of McLean, at 577 units, which sold for $130.8 million, or $226,690 per unit. The seller was Monument Realty LLC.

Top Submarkets

The Pentagon City submarket continues to lead the other submarkets in transaction volume over the past 12 months, at $366 million. Price per unit was still highest in the Columbia Pike submarket, at $387,097. Seminary Road led in units sold, at 1,125, but price per unit here was low (but not the lowest) at $202,667.

Cap Rate Comparisons and Forecasts

After falling through 2011 and reaching a low of 3.8% in the first quarter of 2012, the mean cap rate increased in the second quarter to 4.8%. The suddenly increased cap rate indicates some trepidation on the part of sellers. The 12 month rolling cap of 4.2% is the same as one quarter prior and close to readings obtained through the course of 2011. Reis forecasts some slight decreases in the rolling cap rate through 2013, after which it will reach the 5.0% mark in the out years of the Reis forecast period.