Multifamily Has Two Prices: $444K Doors, 0.77x Loans

The Real Deal reported Oct. 26 that Roxborough Group bought Bidwell Park, a 246-unit community at 39800 Fremont Boulevard, from Pacific Urban Investors for $109.4M. The article reports about $444,500 per unit; dividing the rounded total by 246 gives approximately $444,700. These approximate figures are roughly 65% above an East Bay average near $270,000 (Marcus & Millichap data cited by the Mercury News). Kidder Mathews put Bay Area vacancy at 3.8% in Q3, against 4.8% a year earlier, with 19,156 units under construction, up 28%. The seller's prior price and the buyer's lender were not disclosed.

CRE Daily reported the same day, citing Trepp, that $3.04B across 130 performing Agency floating-rate apartment loans in Texas has DSCR below 1.0x. That is 25.3% of the performing floating-rate balance, at a 0.77x weighted average. Loans packaged in 2021 and 2022 hold 87.5% of delinquent floater dollars, with an 11.33% delinquency rate against 1.35% for other years. Floaters are 21.3% of the state's Agency apartment balance but 55.8% of the $1.35B delinquent.

The broader financing read is weak. NMHC's October survey of 130 apartment executives put its debt financing index at 10, down from 46 in July, and its equity index at 17, down from 44. Of respondents, 81% said borrowing conditions worsened and 61% reported fewer transactions.

Our Read

The 3.8% regional vacancy rate provides context for pricing, but the buyer’s rent-growth assumptions and property-level occupancy were not disclosed. In Texas, the stress sits in a specific instrument. Texas Agency floaters overall carry a 5.74% average coupon against 4.66% on fixed-rate debt. The report does not give a separate coupon for the 2021–22 vintages or establish why their delinquency rate is higher. Geography, operations, financing and vintage all warrant separate underwriting.

The survey adds a warning for the Fremont side. If debt and equity availability stay at the levels NMHC reports, the pool of buyers able to pay $444,500 a door narrows, while 19,156 Bay Area units are under construction. A premium that rests on low vacancy is exposed to the pipeline arriving.

Stakeholder Lens

Lenders: sub-1.0x coverage on a quarter of performing Texas floaters makes extension and maturity terms the number to watch. Buyers: separate a scarcity premium from a financing assumption before comparing price per door across markets. Sellers: a comp at $444,500 helps a Bay Area marketing book and does little outside it. Owners of 2021-22 floaters: the cost of carrying a sub-1.0x loan is reserves or new equity.