Answer
How much is my LA apartment building worth?
Your LA apartment building's value is driven by trailing-12 NOI divided by a submarket cap rate, cross-checked against Gross Rent Multiplier on recent comparable sales, and adjusted for rent regulation exposure, condition, and current-to-market rent spread. A defensible number triangulates income, comps, and replacement cost. Request a free Broker Opinion of Value for a property-specific answer.
Key takeaways
- Value = trailing-12 NOI ÷ the cap rate buyers are actually paying in your submarket.
- Cross-check with GRM against closed comps from the last six months.
- Rent regulation status and loss-to-lease can move value 10–20%.
- Online estimates ignore rent roll quality — they are not usable for pricing.
- A Broker Opinion of Value is free and property-specific.
The three methods buyers actually use
Income capitalization (NOI ÷ cap rate) sets the floor. Sales comps within the last 6 months set the market. Replacement cost sets the ceiling. Where those three converge is the price a real buyer will pay today.
What moves the number 10%+
Rent regulation status (LARSO, AB 1482, Costa-Hawkins), unit mix, condition, loss-to-lease, and submarket demand all move the number materially. Two identical buildings in different submarkets can trade 20%+ apart.
The three valuation methods compared
| Method | Formula | What it tells you |
|---|---|---|
| Income capitalization | NOI ÷ cap rate | The value floor from in-place income |
| Sales comparison | Price ÷ unit or GRM | What the market is paying right now |
| Replacement cost | Land + construction cost | The practical ceiling on value |
Step by step
- 1
Build an accurate trailing-12
Actual collected rents and actual operating expenses — not pro forma. Buyers underwrite the real numbers.
- 2
Pull closed comps
Six months, same submarket, similar unit count and regulation status. Adjust for condition and unit mix.
- 3
Apply the submarket cap rate
Divide NOI by the cap rate those comps actually traded at, then sanity-check the result against GRM.
- 4
Adjust for regulation and upside
Quantify loss-to-lease and the legal path to capture it. This is where two identical buildings diverge in price.
Local context
Cap rates and price-per-unit diverge sharply across the coverage area: coastal South Bay product (Redondo Beach, El Segundo, Manhattan Beach) trades at compressed cap rates, while Long Beach and Gardena value-add product trades wider with more rent upside. Values are drawn from Cameron's own closed comps across 334+ transactions and $446M+ in volume.
Related questions
Is a Zillow or online estimate accurate for an apartment building?
No. Automated estimates model single-family sale prices and cannot read a rent roll, expense load, or rent regulation status — the three variables that set multifamily value.
How do I calculate NOI on my apartment building?
Gross scheduled rent, less vacancy and collection loss, plus other income, minus operating expenses (taxes, insurance, utilities, management, maintenance, reserves). Debt service is excluded from NOI.
Does a vacant unit raise or lower my value?
It can raise it. A vacant unit lets a buyer mark rent to market immediately, which is often worth more than the lost month of income — especially in rent-regulated buildings.
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