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Pacific Crest Realty Acquires Koreatown Community; Valencia Residential Project in DTLA Scores $41 Million Construction Loan

15 Dec 2014, 3:08 pm

By Alex Girda, Associate Editor

Pacific Crest Realty has completed the purchase of Alexandria Apartments in Koreatown for a fee of $6 million, in a deal brokered by Kaufman Commercial for both the buyer and the seller. Located at 435 South Alexandria Avenue, the community will be renamed Chapman Apartments in a nod to Charles Chapman, the developer and philanthropist who built a residence on the site in 1915. The 1927-built apartment building offers 30 one-bedroom apartments and 19 studio units. It’s located near the iconic Chapman Market, the site of the country’s first drive-through grocery back in 1929.

In other local news, Continental Funding Group recently announced that it has completed a deal for a downtown Los Angeles development project. The company’s president, Mitch Paskover, arranged a $41 million construction loan for the development of the Valencia. The deal for the class A apartment project was sourced by Continental through a multifamily construction debt bank. The interest-only loan is LIBOR-based, with a loan-to-cost ratio of 70 percent, and a term of three years with two one-year options. The developer is an active investor focusing on Los Angeles-area markets whose portfolio currently consists of both commercial and residential properties, rentv.com noted.

The project for the Valencia community in Central City West calls for a total of 218 residential units to be built over five floors on a 1.5-acre site on Wilshire Boulevard and Valencia Street. The asset will be located in the immediate proximity of Good Samaritan Hospital. Units are set to offer 9-ft. ceilings, balconies and in-unit washer/dryer, while the resident amenity package includes resort-style landscaping, pool, spa, barbecue areas, health center, 5,000 square feet of outdoor space and a club lounge. Valencia will encourage bike riding with 244 bicycle spaces provided to residents as part of the overall design of the property.

Image: Chapman Market

Image courtesy of ratkovich.net

United States Green Building Council Awards LEED Gold Certification to US Bank Tower

8 Dec 2014, 2:32 pm

By Alex Girda, Associate Editor

The U.S. Bank Tower in L.A., one of the most high-profile office properties in the downtown area, was recently awarded Gold certification under the U.S. Green Building Council’s LEED for Existing Buildings Rating System. The building is currently under the ownership of OUE Limited, while property management duties are being handled by international real estate firm Hines. Tenants at the U.S. Bank Tower include names such as U.S. Bank, Hinshaw & Culbertson, Regus, and the Special Olympics.

Located at 633 West Fifth Street, the 75-story office tower is the tallest building in the Western United States. U.S. Bank Tower was designed by Henry N. Cobb and Harold Fredenberg of I.M. Pei and Partners and was finished back in 1990. The property was acquired last year by OUE Limited, which then employed Hines to provide property management, as well as LEED consulting services. The new owner has plans to add a public observation deck and restaurant on the top floors of the building by the end of Q2 of 2015, in an attempt to turn the asset into a visitor attraction, as well as an upscale office property.

The building has earned the ENERGY STAR label eight times since 2005, and it has a current rating of 84, being 36 percent more energy efficient and saving $1.63 in energy costs per square foot. Green features at the property that have helped the building receive certification include more than 86 percent monthly landfill diversion through recycling and e-waste disposal, a high-performance green cleaning program, alternative commuting transportation in 64 percent of the building population, increased lighting controls to help reduce energy, reduction of carbon emissions, enhanced indoor air quality systems, comprehensive construction waste recycling and reduction in water use by over 30 percent.

Image courtesy of hines.com

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.



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