410 W South Hill Rd
Sunnyside, WA 98944
South Hill I Apartments · Multifamily Property For Sale · 48 Units

Marcus & Millichap is pleased to announce for sale the South Hill I Apartments, a 48-unit apartment complex located in Sunnyside, Washington. The property consists of 10 one-bedroom/one-bathroom apartments, 28 two-bedroom/one-bathroom apartments, eight three-bedroom/one and half-bathroom townhomes, and two four-bedroom/two-bathroom apartments, averaging approximately 892 square feet. The Property was built in 1979, and consists of four 2-story, walkup residential buildings, five 2-story townhouse residential buildings, and a 1-story community building with remodeled onsite management office. The laundry facility was also recently remodeled. Unit amenities include air conditioning, balconies/patios, and storage spaces. Significant capital improvements were completed within the last 10 years including new roofs, windows and sliders, and the parking lot. Units are well-maintained with updated flooring in the majority of the units. All 48 units receive guaranteed rental income through HUD Section 8 Program. Vacancy was less than 1% in 2018 and there is currently a 35-person waitlist. Rents are currently below market and will automatically increase to market rents in March 2020 as a result of the Rent Comparability Study (RCS) completed August 29th, 2019. Pro Forma rents are adjusted by 2%. In addition, the owners have begun converting eight storage units into market rate studio apartments. The first studio unit is currently under construction. The Property is located in Sunnyside, Washington, which is 40 miles between Yakima and the Tri Cities in the heart of the state’s agriculture and wine country. The property is located in an attractive residential neighborhood conveniently a half mile from Interstate 82. There are nearly 100 wineries in the region that attract visitors from across the country. Yakima County also produces the majority of hops for the entire country. The area’s largest employers include several hospitals, Walmart Distribution Center, Darigold, and numerous fruit and vegetable producers and distributors. The South Hill I Apartments provides an investor with a well-maintained complex with strong cash flow. In addition, an investor can add value by converting the remaining storage units to market rate studio units. These conversions will improve the gross income by roughly $40,000 per year, for a total potential of 56 units at the complex. An investor can expect to achieve a double-digit cash-on-cash return upon the rent schedule from the RCS taking effect (March 2020) and expansion of the studio units.