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Pebblebrook Acquires The Hotel Palomar on Wilshire Boulevard in $78.7 Million Deal

21 Nov 2014, 7:53 pm

By Alex Girda, Associate Editor

The Pebblebrook Hotel Trust recently announced the acquisition of a Los Angeles-area hospitality venue, expanding its SoCal upper upscale hotel portfolio. According to a recently issued press statement, the buyer paid a fee of $78.7 million for the Hotel Palomar Los Angeles – Westwood. The property is the 33rd to be added to the Pebblebrook Hotel Trust, and the fifth investment completed by the company in the city of Los Angeles.

The Hotel Palomar offers guests a total of 264 rooms at a great Wilshire Boulevard location in the Westwood neighborhood of L.A. The property is near the Wilshire Corridor, an area that features ultra-luxury, high-rise condo buildings, 11 million square feet of office space, and the University of California, Los Angeles, home to around 40,000 students. The hotel rooms in the Palomar average 380 square feet in size, offering a generous amount of space.

The Hotel Palomar’s amenity package includes a 40-foot outdoor pool and deck offering food and beverages, a fitness center boasting floor-to-ceiling windows, a five-story parking structure that can accommodate approximately 435 vehicles, valet parking, an around-the-clock business center, as well as in-room spa services. Meeting space at the facility is comprised of eight distinct meeting rooms with over 5,000 square feet of meeting space. Dining at the hotel includes the signature dining concept BLVD 16. The eatery offers diners three meals a day and features home-style American cuisine and drinks.

According to the press statement announcing the acquisition, at the end of September 2014, the hotel finished a 12-month period during which the property operated at around 87 percent occupancy, with an average daily rate of $207. Current projections for 2015 place the hotel’s EBITDA at around $5.2-$5.7 million. The hotel will continue to be managed by hospitality company Kimpton Hotels & Restaurants.

Image courtesy of hotelpalomar-lawestwood.com



HFF Completes Sale of Inland Empire West Industrial Development Project

16 Nov 2014, 6:12 pm

By Alex Girda, Associate Editor

Holiday Fenoglio Fowler recently completed the transaction for an Inland Empire West industrial development project. HFF worked on behalf of Xebec Realty Partners, and marketed the Catawba Distribution Center in Fontana, CA. The property was eventually sold by the commercial real estate and capital markets services provider to a discretionary real estate fund for a total fee of around $23 million. The HFF team in charge of the sale consisted of Senior Managing Director Anthony J. Brent and Managing Director Ryan Martin.

Catawba Distribution Center is a fully entitled, future industrial development that when completed will offer up a total of around 310,550 square feet of space. The site totals 13.78 acres of land at the intersection of Santa Anna Avenue and Catawba Avenue, in Fontana, just east of Los Angeles. The site offers great access to Interstate 10, and is located around 12 miles away from the LA/Ontario International Airport. Once completed, the Catawba Distribution Center will feature 32-ft. clear heights, a 180-ft. secured concrete truck court, as well as 35 dock-high positions with 59 trailer positions. The current construction schedule on the project means that the industrial property will be completed in August 2015.

The location of the project in the improving Inland Empire, a hotbed for industrial properties, was an advantage in the sale process. According to Anthony J. Brent, the transaction was “representative of the demand for quality core distribution product,” and he noted that the markets located in the Inland Empire area have seen rent rates go up and vacancy rates go down, especially in the “300,000-square-foot category.” According to data provided by Marcus & Millichap Real Estate Investment Services, the amount of completions in the industrial sector in the Riverside-San Bernadino market has been on a constant upswing over the past few years. Estimated figures for the end of 2014 place the vacancy rate at around six percent, with completions set at nearly 18.5 million square feet of space, expanding the existing stock by around 4.2 percent.  

Chart courtesy of Marcus & Millichap at marcusmillichap.com



Mayor Garcetti Reveals Part of Strategy to Fulfill Housing Demand in Los Angeles, Bulk Up Affordable Housing

8 Nov 2014, 3:19 pm

By Alex Girda, Associate Editor

For the first time since taking office, Mayor Eric Garcetti has detailed strategies for addressing Los Angeles’ housing crisis. Speaking at the Los Angeles Business Council’s Mayoral Housing, Transportation & Jobs Summit, held at the UCLA Anderson School of Management, Garcetti discussed policies that could help remedy the city’s housing challenges, particularly in the affordable sector.

The imbalance between supply and demand is as severe as any time since the post-World War II era. Garcetti’s goal is to add 100,000 new units by 2021, meanwhile bulking up the supply of affordable housing. The city’s Affordable Housing Trust would subsidize development on land owned by the Los Angeles County Metropolitan Transportation Authority. Garcetti also proposed to cut red tape at City Hall and work with key stakeholders to reform the California Environmental Quality Act.

“Increasing affordability can be accomplished by protecting and growing our stock of affordable housing, and by increasing our overall housing supply,” Garcetti said. His policies are  supported by the Los Angeles Business Council, which also expressed concern about the housing shortage.

“Reversing our shortage of affordable housing is critical to keeping Los Angeles attractive for both employers and talented workers,” noted Jacob Lipa, Chairman of LABC and President of Psomas. The conference also tackled issues such as the proposed Los Angeles innovation district and strategies for maintaining the city’s competitiveness in an increasingly global economy.

Image courtesy of lamayor.org

For more L.A. market data, click here.

 

 



HFF and Johnson Capital Arrange Financing for Two Los Angeles Area Commercial Properties

31 Oct 2014, 9:55 pm

By Alex Girda, Associate Editor

Two commercial properties in the Los Angeles area have received financing this week, with a total of approximately $18 million in financing raised for the two assets. HFF worked on behalf of the owners of a class A specialty center in Brentwood, while a Johnson Capital team secured funds for a Pasadena retail center.

HFF recently announced $9.97 million in first lien financing for the acquisition of a specialty center totaling 11,990 square feet of space in the upscale Brentwood area. Located at a 20,022 square-foot lot at 11770 San Vicente Boulevard, the asset is currently fully leased to a roster that includes Pizzicotto Restaurant, First Republic Bank, Subway, Chase Bank ATM and Radco RE. The financing was secured on behalf of buyer GPI Companies through local entity City National Bank, which used the proceeds in the acquisition of the retail asset. The HFF team that worked for the borrower was led by Senior Managing Director Kevin Mackenzie, Associate Directors Greg Brown and Jeff Sause and real estate analyst Jamie Kline.

In other financing news, the Irvine office of Johnson Capital announced that it has arranged $7.8 million in permanent financing for a Pasadena retail property. Located at 855 – 875 S. Arroyo Parkway, the 59,300 square-foot retail property is currently anchored by tenants such as Petco, Staples and BevMo. The fixed rate, non-recourse loan which matures in ten years was provided by AEGON. The Johnson Capital team working to secure the financing on behalf of the owner, a large owner and developer of commercial and multifamily real estate, included Amos Smith and Sean Skelton.



Iconic 801 Tower Ends Long Run of Changes as New Owner Cornerstone Appoints New Property Manager

29 Oct 2014, 7:00 pm

By Alex Girda, Associate Editor

After recently trading hands between seller Mani Brothers Real Estate Group and buyer Cornerstone Real Estate Advisors for a fee of around $177 million, 801 Tower now also has a new property manager. The iconic office property will be managed by Transwestern following an appointment by owner Cornerstone. Transwestern’s on-site management team will be led by Senior Property Manager Annie Hessen.

It has been a year filled with change for 801 Tower at 801 S. Figuroa Street in the South Park area of DTLA. The property announced this fall that it had extended its collaboration with its anchor tenant, law firm Manning & Kass, Ellrod, Ramirez, Trester. The tenant currently occupies 80,328 square feet of the 458,570 square feet of office space that the property has to offer. The agreement was handled by Savills Studley’s downtown L.A. office on behalf of the law firm, while Cornerstone worked with Cushman & Wakefield.

Soon after completing the lease extension, the 25-story office tower was sold by Mani Brothers to Cornerstone. The 1991-built office property currently operates at a vacancy rate of around 13 percent. Floor plans offer tenants 12 corner offices per floor, and an efficient column-free design. The exterior features the building’s signature pink granite and glass combination. Transportation to the area is facilitated by easy access to the nearby Gold, Blue and Red line Metro stations.

Image courtesy of manibrothers.com







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