Downtown Mixed-Use Building with
For Sale
$3,150,000
437 2nd Street, Solvang, CA 93463
SINGLE_FAMILY - Solvang, CA
Property Size6,911 SF
Lot Size0.16 Acres
Price / SF$455.80
Days on Market79
Property Features for 437 2nd Street
General Information
Property type
Residential
Property subtype
Retail
Bathrooms
6
Full bathrooms
3
Half bathrooms
3
Rooms
Bathroom 6, Bathroom 2, Bathroom 5, Bathroom 3, Bathroom 1, Bathroom 4
Subdivision
1 - Not Applicable
Directions
Highway 246 to downtown Solvang. Atterdag to Copenhagen Dr to to 2nd St.
Standard status
Active
APN
139-191-012
Size
6,911 SF
Lot size
0.16 Acres
Building Details
Year built
1981
Floors in Building
4
Listing Agency:
Santa Ynez Valley Real Estate
(805) 688-5717
Listed By:
Allan S. Jones · License #01132470
8056885717x207
Added: Jun 14
Changed: Jul 22
Last Checked: Aug 31 at 12:06PM
MLS# 25000809
Copyright © 2026 North Santa Barbara County Regional MLS. All rights reserved. All information provided by the listing agent/broker is deemed reliable but is not guaranteed and should be independently verified.
Investment Insights
Based on property information with market context.
Located at 437 2nd Street in Solvang, this downtown mixed-use commercial building combines multiple income-producing spaces with an elevated penthouse. The penthouse features a private elevator spanning four floors, three bedrooms, two fireplaces, Douglas fir beams, and vaulted ceilings. A 30+ seat restaurant with a patio is included, along with five retail and office spaces and an additional one-bedroom short-term rental unit. ADA-compliant restrooms are available, and the property includes a carport and on-site parking.
The building is situated across from the Solvang Festival Theater, with convenient downtown access for customers and visitors.
With its combination of food service, flexible storefront and office areas, and a residential-style penthouse configuration, the property presents a distinctive setup for owner-occupants and investors seeking multiple commercial components within a single asset.
The building is situated across from the Solvang Festival Theater, with convenient downtown access for customers and visitors.
With its combination of food service, flexible storefront and office areas, and a residential-style penthouse configuration, the property presents a distinctive setup for owner-occupants and investors seeking multiple commercial components within a single asset.
Key Highlights
- Commercial building built in 1981 in downtown Solvang
- Penthouse spans four floors with a private elevator
- Penthouse features 3 bedrooms, 2 fireplaces, Douglas fir beams, and vaulted ceilings
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$108,264
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
3.44%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$2,165,280
$2.2M
Cap Rate 7%
$1,546,629
$1.5M
Cap Rate 9%
$1,202,933
$1.2M
Market Conditions
NOI Build-Up for 6,911 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$149.3K $21.60/SF
− Vacancy
−$4.9K −$0.71/SF
EGI
$144.4K $20.89/SF
− OpEx
−$36.1K −$5.22/SF
NOI
$108.3K $15.67/SF
Area
Santa Barbara County, CA
Vacancy
3.30%
Lease Rate
$21.60 /SF/Yr
Expense Ratio
25.00%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$2,165,280
Cap Rate 7%
$1,546,629
Cap Rate 9%
$1,202,933
Alternative Uses
Best Use
Specialty Retail
$1.55M
$1.35M – $1.80M
NOI $108,264 @ 7.0% cap · market cap 3.44%
Second Best
Retail
$1.53M
$1.34M – $1.79M
NOI $107,397 @ 7.0% cap · market cap 3.41%
Theoretical Best
Multifamily LT 5
$2.17M
$1.90M – $2.53M
NOI $151,835 @ 7.0% cap · market cap 4.82%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Lease Details
1
Residential units
Multi-tenant
Tenancy
Location Intelligence
Trade Area within ½ mile
911
Businesses Nearby
23k
Monthly Visits Nearby
Explore this area
Business Placement
Foot Traffic Nearby
Home Improvements & Furnishings 53%
Hotels & Casinos 39%
Dining 8%
Valley Hardware and Garden Center
Home Improvements & Furnishings
12,078 visits/mo
0.2 miles
Svendsgaard's Danish Lodge Americas Best Value Inn
Hotels & Casinos
8,976 visits/mo
0.3 miles
Domino's Pizza
Dining
1,735 visits/mo
0.2 miles
Demographics for 93463, CA
8,731
Population
3,672
Households
2.4
Avg Household Size
52
Median Age
44%
College-Educated
94%
High-School Grad
33.9 sq mi
ZIP Area
258
Density / Sq Mi
$130,123
Median Household Income
$53,188
Median Earnings
$1,895
Median Rent
$1,044,100
Median Home Value
Market
Vacancy Rate% for Retail in West region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Mixed-use property - Downtown Solvang mixed-use building with a restaurant patio, multiple retail/office spaces, and a multi-level penthouse.
Where is this mixed-use property located?
The property is located at 437 2nd Street Solvang, CA.
What is the asking price?
The asking price for this property is $3,150,000.
What are key features of this property?
This property features: Commercial building built in 1981 in downtown Solvang; Penthouse spans four floors with a private elevator; Penthouse features 3 bedrooms, 2 fireplaces, Douglas fir beams, and vaulted ceilings
