Multi-Tenant Retail Strip
For Sale
$2,950,000
2874 Alum Rock Ave, San Jose, CA 95127
Multi-tenant retail strip center on a highly visible San Jose corridor with direct street exposure along Alum Rock Avenue.
Property Size3,486 SF
Price / SF$846.24
Days on Market116
Property Features for 2874 Alum Rock Ave
General Information
Standard status
Active
Size
3,486 SF
Property subtype
Shopping Strip
Amenities
±3,480 SF multi-tenant retail building High visibility along a major retail corridor with strong traffic counts
Diverse tenant mix (restaurant, retail, professional services)
Strong signage opportunities along Alum Rock Avenue Located in a dense, infill East San Jose trade area Proximity to major retail hubs such as Eastridge Center and Alum Rock Village
Building Details
Building Size
3,486 SF
Year Built
1963
Listing Agency:
Marcus & Millichap - Palo Alto
Listed By:
Eric Carrillo · License #License(s): CA: 02111809
(650) 391-1742
Source:
Marcusmillichap
Added: May 14
Changed: Aug 22
Last Checked: Sep 6 at 4:18AM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of Marcus & Millichap - Palo Alto
Investment Insights
Based on property information with market context.
2874 Alum Rock Avenue is a multi-tenant retail strip center offering street-level retail space within an established commercial corridor in San Jose. The center is positioned directly on Alum Rock Avenue, providing strong street exposure and consistent daily visibility for passing traffic.
The property sits adjacent to recently delivered high-density multifamily apartments and a range of existing retail establishments, supporting an active neighborhood retail environment. This combination of direct frontage and nearby residential density can be attractive for tenants seeking convenient, retail-oriented access from the main thoroughfare.
As a shopping center asset within a retail strip configuration, the building is designed to serve multiple occupants, making it suitable for diversified retail leasing within a single ownership structure.
The property sits adjacent to recently delivered high-density multifamily apartments and a range of existing retail establishments, supporting an active neighborhood retail environment. This combination of direct frontage and nearby residential density can be attractive for tenants seeking convenient, retail-oriented access from the main thoroughfare.
As a shopping center asset within a retail strip configuration, the building is designed to serve multiple occupants, making it suitable for diversified retail leasing within a single ownership structure.
Key Highlights
- Multi‑tenant retail strip center built in 1963
- Located directly on Alum Rock Avenue in a highly visible San Jose corridor
- Direct street exposure with consistent daily traffic
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
$94,162
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
3.19%
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%
$1,883,240
$1.9M
Cap Rate 7%
$1,345,171
$1.3M
Cap Rate 9%
$1,046,244
$1.0M
Market Conditions
NOI Build-Up for 3,486 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
$141.0K $40.44/SF
− Vacancy
−$6.5K −$1.85/SF
EGI
$134.5K $38.59/SF
− OpEx
−$40.4K −$11.58/SF
NOI
$94.2K $27.01/SF
Area
ZIP 95127
Vacancy
4.58%
Lease Rate
$40.44 /SF/Yr
Expense Ratio
30.00%
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%
$1,883,240
Cap Rate 7%
$1,345,171
Cap Rate 9%
$1,046,244
Alternative Uses
Best Use
Retail
$1.35M
$1.18M – $1.57M
NOI $94,162 @ 7.0% cap · market cap 3.19%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$2.09M
$1.83M – $2.44M
NOI $146,496 @ 7.0% cap · market cap 4.97%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
854
Businesses Nearby
92k
Monthly Visits Nearby
Explore this area
Business Placement
Foot Traffic Nearby
Dining 60%
Shops & Services 21%
Apparel 12%
Home Improvements & Furnishings 5%
Jack in the Box
Dining
25,469 visits/mo
0.2 miles
Taco Bell
Dining
17,985 visits/mo
0.1 miles
Goodwill
Apparel
10,728 visits/mo
0.3 miles
QuikStop
Shops & Services
9,798 visits/mo
0.4 miles
Starbucks
Dining
7,992 visits/mo
0.4 miles
Demographics for 95127, CA
63,749
Population
16,823
Households
3.8
Avg Household Size
37
Median Age
27%
College-Educated
73%
High-School Grad
19.0 sq mi
ZIP Area
3,355
Density / Sq Mi
$120,548
Median Household Income
$45,348
Median Earnings
$2,549
Median Rent
$995,100
Median Home Value
Market
Vacancy Rate% for Retail in San Jose, CA
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Strip mall - Multi-tenant retail strip center on a highly visible San Jose corridor with direct street exposure along Alum Rock Avenue.
Where is this strip mall located?
The property is located at 2874 Alum Rock Ave San Jose, CA.
What is the asking price?
The asking price for this property is $2,950,000.
What are key features of this property?
This property features: Multi‑tenant retail strip center built in 1963; Located directly on Alum Rock Avenue in a highly visible San Jose corridor; Direct street exposure with consistent daily traffic
