Using an extension of standard option pricing theory for sporadically traded assets, this paper presents a new methodology for valuing commercial real estate (CRE) and real options on them. We apply this method to value multifamily apartments in Los Angeles, California over the 2001 - 2019 time period and compare it to a standard hedonic model. Our model performs better both in- and out-of-sample, maintaining robustness despite changing market conditions. We also illustrate how to use our approach to value a European call option to purchase a CRE.