Mixed-Use Property in Downtown San
For Sale
$8,280,000
555 S Second St, San Jose, CA 95112
39-unit mixed-use property with retail space in vibrant SoFA District.
Property Size20,521 SF
Lot Size0.33 Acres
Price / SF$403.49
Days on Market152
Property Features for 555 S Second St
General Information
Standard status
Active
Size
20,521 SF
Lot size
0.33 Acres
Property subtype
Multifamily
Amenities
EXTREMELY COMPELLING BASIS Offered at approximately $212,000+ per unit.
PRIME SOFA DISTRICT LOCATION In the vibrant SoFA District in Downtown San Jose.
IMMEDIATE VALUE-ADD Approximately 15 units delivered vacant for rapid renovation and lease-up.
STRONG RENTAL DEMAND Walking distance to San Jose State University.
MIXED-USE ASSET 38 apartments plus 1 retail space
NEAR MAJOR TRANSIT & GROWTH Close to Diridon Station and future Downtown West development.
Building Details
Units
39
Listing Agency:
Marcus & Millichap
(650) 391-1777
Listed By:
Jimmy Castellanos · License #License(s): CA: 02024152
(650) 391-1777
Source:
Marcusmillichap
Added: Apr 3
Changed: Aug 22
Last Checked: Aug 31 at 12:54PM
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
Investment Insights
Based on property information with market context.
Located at 555–569 South 2nd Street in Downtown San Jose, Metro Walk is a mixed-use apartment community featuring 39 units. Constructed in 1928, the property occupies approximately 14,474 square feet of land and includes a 38-unit apartment building along with one ground-floor retail space. The total rentable area is roughly 20,521 square feet. The unit mix is predominantly studio apartments, with 37 studio units, one one-bedroom/one-bath unit, and one retail space. Positioned within walking distance of San Jose State University, the property benefits from its proximity to major transit infrastructure, including Diridon Station and the proposed Google Downtown West campus. Approximately 15 units have been updated within the last 10 years, featuring improvements such as updated kitchen cabinets and countertops, new carpet, baseboards, and two-tone paint. Exterior improvements include dual-pane windows and building updates. The property will be delivered with approximately 15 vacant units. Metro Walk is situated in the SoFA District (South First Area), known for its restaurants, cafés, art galleries, music venues, and boutique retail. Residents have access to entertainment, dining, and employment centers throughout Silicon Valley.
Key Highlights
- Significant value‑add opportunity with approximately 15 vacant units ready for renovation.
- Prime downtown San Jose location in the SoFA District, walking distance to San Jose State University.
- Mixed‑use property featuring 38 apartments and one ground‑floor retail space, providing diverse income streams.
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
$426,835
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
5.16%
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%
$8,536,700
$8.5M
Cap Rate 7%
$6,097,643
$6.1M
Cap Rate 9%
$4,742,611
$4.7M
Market Conditions
NOI Build-Up for 20,521 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
$812.6K $39.60/SF
− Vacancy
−$36.6K −$1.78/SF
EGI
$776.1K $37.82/SF
− OpEx
−$349.2K −$17.02/SF
NOI
$426.8K $20.80/SF
Area
San Jose, CA
Vacancy
4.50%
Lease Rate
$39.60 /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%
$8,536,700
Cap Rate 7%
$6,097,643
Cap Rate 9%
$4,742,611
Alternative Uses
Best Use
Apartment 5plus
$6.10M
$5.34M – $7.11M
NOI $426,835 @ 7.0% cap · market cap 5.16%
Second Best
Mixed Use
$6.07M
$5.31M – $7.08M
NOI $424,785 @ 7.0% cap · market cap 5.13%
Theoretical Best
Office A
$12.39M
$10.84M – $14.46M
NOI $867,528 @ 7.0% cap · market cap 10.48%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Location Intelligence
Trade Area within ½ mile
4,696
Businesses Nearby
Explore this area
Business Placement
Demographics for 95112, CA
60,754
Population
22,969
Households
2.6
Avg Household Size
33
Median Age
39%
College-Educated
82%
High-School Grad
7.3 sq mi
ZIP Area
8,322
Density / Sq Mi
$89,649
Median Household Income
$45,690
Median Earnings
$2,095
Median Rent
$956,300
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?
Mixed-use property - 39-unit mixed-use property with retail space in vibrant SoFA District.
Where is this mixed-use property located?
The property is located at 555 S Second St San Jose, CA.
What is the asking price?
The asking price for this property is $8,280,000.
What are key features of this property?
This property features: Significant value‑add opportunity with approximately 15 vacant units ready for renovation.; Prime downtown San Jose location in the SoFA District, walking distance to San Jose State University.; Mixed‑use property featuring 38 apartments and one ground‑floor retail space, providing diverse income streams.
