Lakewood Mixed-Use Sale Offers Lessons for Boise Multifamily Investors

Mixed-use properties can provide several income streams under one roof, but they also require investors to evaluate more than apartment rents alone.

A recent transaction in Washington shows why these properties continue to attract private capital—and why Boise commercial real estate investors should study the details behind the headline price.

According to reporting by Georgina Brown for CoStar News, Prestige Equity Partners acquired Town Centre Village in Lakewood, Washington, for $9.05 million. The property combines apartments, townhome-style units, and street-level commercial space.

A Diverse Mix of Residential and Retail Space

Town Centre Village is located at 10240 Bridgeport Way SW in Lakewood, southwest of Tacoma. The three-story property was originally developed in 2005 and expanded in 2017.

The project includes 37 apartments with the following mix:

• 23 one-bedroom units
• 11 two-bedroom units
• Three three-bedroom units

The property also contains 13 ground-floor retail suites and a separate fourplex with a townhouse-style design.

That mix gives the new owner exposure to both residential and commercial demand. Apartment leases can provide a relatively steady income base, while the retail spaces can offer additional revenue and longer lease terms.

The tradeoff is added complexity. Residential and commercial tenants have different leasing needs, operating expenses, renewal patterns, and improvement costs. A successful owner must understand both sides of the property.

The Sale Price Does Not Tell the Whole Story

The reported purchase price equals approximately $244,595 per apartment. However, that calculation does not fully capture the value of the property because the sale also includes the retail suites.

Investors evaluating a mixed-use acquisition should separate the different parts of the income stream. Important questions include:

• How much rent comes from the apartments?
• How much comes from the retail spaces?
• Are any commercial suites vacant?
• When do the retail leases expire?
• Which tenants are responsible for operating expenses?
• Are the apartment rents above or below the local market?
• Will any major tenant improvements be needed?
• How much of the property’s value is tied to the commercial component?

Without those details, a simple price-per-unit comparison can be misleading. A property with 37 apartments and 13 retail spaces cannot be compared directly with a traditional 37-unit apartment building.

The transaction is also notable because Town Centre Village reportedly sold for approximately $9.3 million in December 2021. Its latest price of $9.05 million is about $250,000 lower than the prior sale price.

That difference does not automatically mean the property lost economic value. Financing conditions, interest rates, income, occupancy, capital improvements, and buyer expectations may have changed. Still, the lower resale price is a reminder that commercial property values do not always move upward in a straight line.

What Boise Investors and Developers Can Learn

Mixed-use development is becoming more relevant across the Treasure Valley as Boise, Meridian, Eagle, Garden City, Nampa, and Caldwell continue to grow.

Developers often use apartments to create built-in traffic for restaurants, service businesses, and neighborhood retailers. When designed well, the residential and commercial uses support each other. Residents gain convenient services, while businesses gain a nearby customer base.

But the ground-floor retail must fit the surrounding market. Adding storefront space does not guarantee that tenants will lease it.

Successful retail leasing in Boise depends on visibility, parking, signage, access, tenant mix, suite size, and nearby household demand. A retail bay located below apartments may still struggle if customers cannot find it, park easily, or enter the site conveniently.

For Boise development projects, the commercial space should be planned around realistic tenant demand—not simply included because mixed-use design looks good on paper. Smaller suites may work well for coffee shops, salons, fitness studios, professional services, and neighborhood restaurants. Larger spaces may require stronger traffic counts and a broader customer draw.

Investors should also account for the different costs associated with each use. Apartment turnover may involve paint, flooring, appliances, and routine repairs. Retail turnover can require months of downtime, brokerage fees, tenant improvement allowances, and major construction work.

Local Insight: Underwrite Each Property as Two Businesses

My take is that a mixed-use property should be evaluated as two connected businesses.

First, analyze the residential portion as a multifamily investment. Review rents, occupancy, concessions, operating expenses, unit condition, and competing apartment projects.

Then analyze the commercial portion as a retail or office investment. Review each tenant’s lease, credit, renewal options, expense reimbursements, rent increases, and future improvement obligations.

Finally, determine how the two parts work together.

For Boise commercial real estate investors, the best mixed-use opportunities may be properties where the apartments provide dependable income and the commercial spaces serve clear neighborhood needs. The greatest risk may be a project that depends on aggressive retail rents or assumes every storefront will remain occupied.

The Lakewood sale is not a direct measure of Boise multifamily values. It is a useful regional example of how private investors are approaching properties with multiple uses and income sources. As Boise development becomes denser, understanding this type of investment will become increasingly important for buyers, landlords, tenants, and developers.

Mike Gioioso (joy-OH-so) has for 16+ years been helping companies of all sizes buy, build, and lease perfect places for business in greater Boise, Idaho and beyond.
www.streetsmartidaho.com mike@streetsmartidaho.com 208-209-9166

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