Palm Canyon Drive Mixed-Use
For Sale
$5,500,000
431 South Palm Canyon Drive, Palm Springs, CA 92262
Two-story building in revitalized downtown Palm Springs financial district.
Property Size15,781 SF
Price / SF$364.07
Days on Market179
Property Features for 431 South Palm Canyon Drive
General Information
Standard status
Active
Size
15,781 SF
Class
B
Property subtype
Office
Net Operating Income
$168,298
Building Details
Building Size
15,781 SF
Year Built
1960
Listing Agency:
Coldwell Banker Commercial Lyle & Associates
(760) 774-6533
Listed By:
Michael Lyle · License #CalDRE #02002995
Source:
Cbclyle
Added: Mar 5
Changed: Aug 27
Last Checked: Aug 30 at 2:59PM
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 Coldwell Banker Commercial Lyle & Associates
Investment Insights
Based on property information with market context.
Located at 431 S. Palm Canyon Drive, this two-story building offers 15,107 square feet of space. Originally constructed in 1960 as a Wells Fargo Bank with a drive-through and second-floor office suites, the property presents an opportunity for an owner/user to occupy the entire first floor of 6,958 square feet. The current tenant, HomeSmart, occupies the first floor with a lease ending on 04/30/2022, with no options to extend. The second floor comprises eight units of varying sizes and uses. Situated in the old financial block of downtown Palm Springs, the property benefits from recent investments and changes in the area, including the redevelopment of the historic JW Robinson Department store into a multi-tenant property featuring restaurants, bars, entertainment venues, BevMo, and Orange Theory. The location is south of the high-traffic bar-hopping zone, offering dynamic redevelopment possibilities. Adjacent to the property is the Eisenhower Health Center, which underwent a major overhaul of its 14,152 square foot property in 2013. The area has transformed into a mixed-use district with retail, office, medical, and financial services, including restaurants, bars, and venue spaces. The property offers potential to increase the size of the first floor by utilizing excessive driveway entrances to add square footage. Opportunities exist to add storefronts on Palm Canyon Drive in place of the former bank drive-through lanes, standardize leasing forms, synergize with the neighboring Eisenhower Health building, explore new leasing strategies to increase income, and redevelop the property, particularly with condominiums above restaurant/bar/retail spaces.
Key Highlights
- Prime owner/user opportunity to occupy 6,958 sf of the first floor with prominent signage and ground floor frontage.
- Located in a rapidly redeveloping downtown Palm Springs block with high foot traffic and major investments.
- Opportunity to increase building size by converting excessive driveway entrances into additional storefronts on Palm Canyon Drive.
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
$237,356
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
4.32%
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%
$4,747,120
$4.7M
Cap Rate 7%
$3,390,800
$3.4M
Cap Rate 9%
$2,637,289
$2.6M
Market Conditions
NOI Build-Up for 15,107 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
$346.3K $22.92/SF
− Vacancy
−$29.8K −$1.97/SF
EGI
$316.5K $20.95/SF
− OpEx
−$79.1K −$5.24/SF
NOI
$237.4K $15.71/SF
Area
Riverside County, CA
Vacancy
8.60%
Lease Rate
$22.92 /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%
$4,747,120
Cap Rate 7%
$3,390,800
Cap Rate 9%
$2,637,289
Alternative Uses
Best Use
Office B
$3.39M
$2.97M – $3.96M
NOI $237,356 @ 7.0% cap · market cap 4.32%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$4.53M
$3.96M – $5.28M
NOI $316,806 @ 7.0% cap · market cap 5.76%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
1,842
Businesses Nearby
Explore this area
Business Placement
Demographics for 92262, CA
26,593
Population
19,940
Households
1.3
Avg Household Size
54
Median Age
42%
College-Educated
93%
High-School Grad
35.1 sq mi
ZIP Area
758
Density / Sq Mi
$70,514
Median Household Income
$42,940
Median Earnings
$1,420
Median Rent
$600,600
Median Home Value
Market
Vacancy Rate% for Office in West region
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Office building - Two-story building in revitalized downtown Palm Springs financial district.
Where is this office building located?
The property is located at 431 South Palm Canyon Drive Palm Springs, CA.
What is the asking price?
The asking price for this property is $5,500,000.
What are key features of this property?
This property features: Prime owner/user opportunity to occupy **6,958 sf of the first floor** with prominent signage and ground floor frontage.; Located in a rapidly redeveloping downtown Palm Springs block with high foot traffic and major investments.; Opportunity to increase building size by converting excessive driveway entrances into additional storefronts on Palm Canyon Drive.
