Two rental properties on Boulder's University Hill have sold for more than $578,000 per unit, making it among the highest priced deals in state history.
The two properties, 1138 Grandview Ave. and 959 Marine St., sold for $16.2 million to W.G. Real Estate Investments, a local entity. Officials from W.G. could not be reached for comment.
California-based Bell Advisors was the seller. Boulder's 50 Maple Real Estate Group Re/Max Alliance on Walnut facilitated the transaction.
With a combined 28 units, the sale of both buildings fetched a per-unit price of $578,571.
Very few deals top $300,000 per unit in Colorado, though that number has been creeping ever higher in recent years as investors have made a string of high-dollar purchases in Boulder County and the Denver metro area.
The number of properties selling for more than $500,000 are even rarer.
In 2015, the 84-unit Province sold for $48.8 million, or $580,952 per unit, and the Plaza on Broadway fetched a stunning $24 million for its 39 units — $616,667 per unit.
Those buildings were all student apartments. That's important, said ARA Newmark broker Shane Ozment, because each unit is often divided into multiple bedrooms, maximizing the rent property owners can collect.
For instance, the Grandview and Marine properties have a combined 77 bedrooms.
"They're renting per bed; you could get $1,000 or $1,100 per bed," Ozment said. "You can get much higher income than on a two-unit (apartment) in Denver."
That's what has pushed per-unit sales in Boulder far beyond deals in the rest of the state, Ozment said.
Compounding the cost is the extremely low supply of residential property for sale on the Hill, added local real estate agent Todd Walsh.
Only two properties are currently listed, he said, one of them by Walsh's own firm, Boom Properties.
"Properties on the Hill are in very high demand and they have been for some time," he said.
The area underwent a moratorium on residential development for seven months in 2014 and 2015 in an attempt to add diversity to the student-heavy area. It's not clear if that had an effect on increasing property values, Walsh said.
In the year surrounding the ban (fourth quarter 2014 to Q4 2015), vacancy rates in the university area did decline from 3.5 percent to 2.7 percent.
But rents during the same time stayed relatively flat (around $1,500), while growing more than 25 percent in the rest of the city, according to data from the Apartment Association of Metro Denver's Vacancy and Rent Surveys.
A room at 959 Marine St. was listed for $1,095 per month on the website for Four Star Realty and Property Management. The property at 1138 Grandview showed no current listings, but archived pages show prices between $1,000 and $1,245.