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Photo: MLS Image 1 of / 32 Caption Close Image 2 of 32 A living room A living room Photo: MLS Image 3 of 32 The living room is open to the kitchen The living room is open to the kitchen Photo: MLS Image 4 of 32 A view of the bedroom A view of the bedroom Photo: MLS Image 5 of 32 Image 6 of 32 A close up on the kitchen A close up on the kitchen Photo: MLS Image 7 of 32 A bathroom A bathroom Photo: MLS Image 8 of 32 A bedroom A bedroom Photo: MLS Image 9 of 32 Another bedroom Another bedroom Photo: MLS Image 10 of 32 Image 11 of 32 Another bathroom Another bathroom Photo: MLS Image 12 of 32 The common outdoor space The common outdoor space Photo: MLS Image 13 of 32 A view up the side of the building A view up the side of the building Photo: MLS Image 14 of 32 A detail on the entrance of the 1923 building. A detail on the entrance of the 1923 building. Photo: MLS Image 15 of 32 Image 16 of 32 1035 Pine Street, a 38-unit building, was listed at $11.65 million in April and sold for $12.7 million in June. 1035 Pine Street, a 38-unit building, was listed at $11.65 million in April and sold for $12.7 million in June. Photo: MLS Image 17 of 32 The lobby of 1035 Pine The lobby of 1035 Pine Photo: MLS Image 18 of 32 An apartment unit's living room An apartment unit's living room Photo: MLS Image 19 of 32 A bedroom A bedroom Photo: MLS Image 20 of 32 Image 21 of 32 A kitchen A kitchen Photo: MLS Image 22 of 32 A bathroom A bathroom Photo: MLS Image 23 of 32 Another living room Another living room Photo: MLS Image 24 of 32 Another kitchen Another kitchen Photo: MLS Image 25 of 32 Image 26 of 32 Another bathroom Another bathroom Photo: MLS Image 27 of 32 324 Larkin Street, a 24-unit building, was sold for $5.833 million in May after being listed for $5 million. 324 Larkin Street, a 24-unit building, was sold for $5.833 million in May after being listed for $5 million. Photo: MLS Image 28 of 32 A kitchen A kitchen Photo: MLS Image 29 of 32 A large deck A large deck Photo: MLS Image 30 of 32 Image 31 of 32 Views to city hall Views to city hall Photo: MLS Image 32 of 32 High rents, low inventory push S.F. multifamily market to new heights 1 / 32 Back to Gallery

Apartment buildings in the Tenderloin are now worth more per square foot than multifamily properties in Marin, according to a recent report from Paragon Realty. Buildings with five or more units in the San Francisco neighborhood sell for an average of $357 per square foot, versus $298 per square foot for five-plus units in Marin.

The downtown corridor saw by far the highest number of apartment units sold thus far in 2014, with 547 units sold in 18 buildings — check out some recent sales in the gallery above. By contrast, 165 units were sold in 16 buildings in Noe and Eureka Valley, the Haight and Duboce Triangle combined.

What’s more, $357 per square foot is on the low end for a multifamily property in San Francisco. Multifamilies in the Richmond are selling at an average of $390 a square foot, Russian/Telegraph Hill properties are trading at $490 a square foot, and Pacific Heights/Marina properties are going for $526 a square foot, according to the report.

Hayes Valley/NoPa is selling at an average of $426 a square foot, but a recent deal on a 34-unit trophy building off Alamo Square (pictured in the gallery below) should push that number much higher.









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Photo: MLS Image 1 of / 9 Caption Close Image 2 of 9 The gilded entry The gilded entry Photo: MLS Image 3 of 9 The entrance foyer to the penthouse unit The entrance foyer to the penthouse unit Photo: MLS Image 4 of 9 Beautiful views from all sides of the 7-story building. Beautiful views from all sides of the 7-story building. Photo: MLS Image 5 of 9 Image 6 of 9 There are 17 one-bedrooms and 16 studios in the building. There are 17 one-bedrooms and 16 studios in the building. Photo: MLS Image 7 of 9 Coved ceilings are just one of the architectural details in the 1930 property. Coved ceilings are just one of the architectural details in the 1930 property. Photo: MLS Image 8 of 9 The garage has parking for 17 cars and a motorcycle. The garage has parking for 17 cars and a motorcycle. Photo: MLS Image 9 of 9 High rents, low inventory push S.F. multifamily market to new heights 1 / 9 Back to Gallery

As SFGate reported in May, the 32,000-square-foot property was listed at $16 million—or about $500 a square foot. After two weeks, it received multiple offers from every large local owner, according to listing agent Jay Greenberg of Alain Pinel. Of the six offers, five came in over asking. When asked for their “best and final” offers, several buyers came in all-cash with no contingencies and a $1 million earnest money deposit. The winning offer was “way over the asking price,” said Greenberg, who could not reveal the final number since the deal has not yet closed escrow.

Greenberg pointed to the city’s high employment and rents as one reason for all the action in the multifamily market. Paragon reported that a median one-bedroom apartment in the city ranges from $1,895 a month in the Outer Sunset to $3,548 in Yerba Buena. (One-bedrooms make up 45% of the apartment inventory in San Francisco, Marin and San Mateo counties.) He also said that apartments provide investors with a reliable but healthy return on their investments, which looks especially appealing in a climate where banks are offering low interest rates on CDs and savings accounts, and the stock market is volatile and unpredictable. “If you want a return, there’s a lot more safety and control if you buy apartments than the alternatives,” he said.

These factors, plus the same lack of inventory that’s affecting the single-family market, has created what Greenberg calls an “unprecedented seller’s market.” He said that the difference between the multifamily market today and the last run up in 2005 is that, during the last peak, the market was dominated by one buyer, who typically offered significantly more than other buyers.

“In this market, if one buyer doesn’t put an offer in, there’s another one and another one,” he explained.

Emily Landes is a writer and editor who is obsessed with all things real estate. She also has a DIY problem that she blogs about at pritical.com.