IT IS SHOVEL READY WITH PLANS FOR 5-UNIT DEVELOPMENT
A $988,000 graffiti-covered West Oakland fixer-upper might seem expensive — until you consider everything that comes with the sale.
The price on the property at 1818 Adeline includes architectural plans that would transform the 6,450-square-foot lot into three townhomes, plus lifting and restoring the 1890 Victorian to create two more units. The finished project would offer 5,800 square feet of living space — and the potential for a stream of rental income for its new owner.
While the rate of growth in Oakland’s median monthly rent has slowed, increasing 1 percent from 2017 to 2018, it shot up 44 percent from $2,133 in 2014 to $3,066 in 2018, according to the SF Business Times.
Listing agent Kevin Cunningham of Red Oak Realty said the seller spent more than a year and $100,000 having the plans drawn up and pushed through the city of Oakland’s approval process. Cunningham added that the lot was zoned for four units and the seller obtained a variance for an additional unit.
“We call it ‘shovel ready,'” he said. “All you have to do is pay for building permits.”
(See the plans for the property in the gallery above.)
You can’t put a dollar amount on the worth of the approved site plans, but anyone who has built a development in the Bay Area knows they’re worth a lot of time and headaches.
It’s also difficult to pin down how much it would cost to build the apartment complex as real estate is so personal. While some might opt for a more high-end job with top-of-the-line fixtures, others could focus on budget. According to contractors SFGATE spoke with, the price could be anywhere from $300 to $600 per square foot. A contractor could probably build the project for $250.
At these prices, a 5,800-square-foot development could cost anywhere from $1.45 million to $3.48 million. Keep in mind, this doesn’t include the expense for connecting utilities, additional permits and multiple other costs that contractors say easily add up with developments.
Another important number to consider is the value of the home after it’s built. Oakland real estate has increased in recent years, and the median house sales price went from $275,000 in 2012 to $800,00 in 2019. Cunningham postulates after being completed, the complex would be over $3 million, and this number seems accurate when you consider the median list price per square foot in Oakland is $529, according to Zillow. This puts the developments value at roughly $3 million when complete.
Cunningham said this sale is about potential but also location. The property is in the heart of West Oakland, close to downtown Oakland and BART. Across the street, DeFremery Park spreads across 9.5 verdant acres with a skate park, tennis courts and a swimming pool.