Updated Multi-Unit Apartment
For Sale
$1,495,000
406 5th Street, Watsonville, CA 95076
Well-maintained eight-unit apartment building on one parcel in Watsonville with separate gas and electric meters.
Property Size4,350 SF
Price / SF$343.68
Days on Market22
Property Features for 406 5th Street
General Information
Standard status
Active
Size
4,350 SF
Property subtype
General Commercial
Taxes and HOA fees
Annual Taxes
$17,940
Amenities
3
Composition
Level
Level.
Building Details
Year Built
1890
Listing Agency:
Lighthouse Realty
(831) 423-7355
Listed By:
Peter Cook
Source:
Xome
Added: Jul 18
Changed: Aug 8
Last Checked: Aug 8 at 4:24AM
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 Lighthouse Realty
Investment Insights
Based on property information with market context.
Well-maintained multi-unit apartment building comprising eight units on one parcel, including 642 Lincoln Street (6 units) and 406 E 5th Street (duplex). Unit interiors feature updates such as newer electric panels and wall heaters, with most kitchens and bathrooms upgraded. Additional improvements include newer flooring and dual-pane windows. Tenants have separate gas and electric meters, and the property includes a separate laundry room with coin-operated machines.
The building is located in the heart of Watsonville, with no further site or access details provided in the available information.
The property is described as fully occupied with long-term tenants and no vacancy for many years. Buyers should note the existing tenancy and the instruction not to disturb tenants.
The building is located in the heart of Watsonville, with no further site or access details provided in the available information.
The property is described as fully occupied with long-term tenants and no vacancy for many years. Buyers should note the existing tenancy and the instruction not to disturb tenants.
Key Highlights
- 8‑unit apartment building in Watsonville on one parcel
- Separate gas and electric meters for the units
- Units include newer electric panels and wall heaters, plus updated kitchens and bathrooms
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
$111,969
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
7.49%
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%
$2,239,380
$2.2M
Cap Rate 7%
$1,599,557
$1.6M
Cap Rate 9%
$1,244,100
$1.2M
Market Conditions
NOI Build-Up for 4,350 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
$208.8K $48.00/SF
− Vacancy
−$5.2K −$1.20/SF
EGI
$203.6K $46.80/SF
− OpEx
−$91.6K −$21.06/SF
NOI
$112.0K $25.74/SF
Area
Santa Cruz County, CA
Vacancy
2.50%
Lease Rate
$48.00 /SF/Yr
Expense Ratio
45.00%
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%
$2,239,380
Cap Rate 7%
$1,599,557
Cap Rate 9%
$1,244,100
Alternative Uses
Best Use
Apartment 5plus
$1.60M
$1.40M – $1.87M
NOI $111,969 @ 7.0% cap · market cap 7.49%
Second Best
—
—
no second resolved use
Theoretical Best
Retail
$2.49M
$2.18M – $2.90M
NOI $174,113 @ 7.0% cap · market cap 11.65%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Current Use
Location Intelligence
Trade Area within ½ mile
1,274
Businesses Nearby
Explore this area
Business Placement
Demographics for 95076, CA
84,433
Population
26,488
Households
3.2
Avg Household Size
35
Median Age
19%
College-Educated
72%
High-School Grad
135.1 sq mi
ZIP Area
625
Density / Sq Mi
$86,685
Median Household Income
$36,077
Median Earnings
$1,851
Median Rent
$767,200
Median Home Value
Market
Vacancy Rate% for Multifamily in West region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Apartment building - Well-maintained eight-unit apartment building on one parcel in Watsonville with separate gas and electric meters.
Where is this apartment building located?
The property is located at 406 5th Street Watsonville, CA.
What is the asking price?
The asking price for this property is $1,495,000.
What are key features of this property?
This property features: 8‑unit apartment building in Watsonville on one parcel; Separate gas and electric meters for the units; Units include newer electric panels and wall heaters, plus updated kitchens and bathrooms
