Decron Pays $114M for LA Asset
This marks the company's first purchase in almost two years.
Decron Properties has acquired 5550 Wilshire, a 163-unit community in Los Angeles, for $114 million. GID previously owned the property, according to Yardi Matrix. JLL Senior Managing Director Blake Rogers represented both parties in the transaction.
Completed in 2010, 5550 Wilshire consists of one- to three-bedroom units, as well as townhomes, that average 1,323 square feet.
Amenities encompass a swimming pool and spa, rooftop lounges and a private movie theater, among other features. The property also includes 14,686 square feet of ground-floor retail space with tenants such as Chipotle, Five Guys and FedEx.
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Located in Los Angeles’ Miracle Mile, 5550 Wilshire is less than 1 mile from Decron’s headquarters, within a submarket the company has known and operated in for decades. The neighborhood includes more than 5 million square feet of office space and numerous retail destinations.
The property traded at a substantial discount to replacement cost in a deal that marked Decron’s first acquisition in nearly two years. Before that, the firm focused more on Sun Belt markets where risk-adjusted returns edged out all other metros, according to a company statement.
Decron will continue to pursue opportunities across markets such as Phoenix, Austin and Salt Lake City, while also complementing its investment strategy with established West Coast metros, including Los Angeles, San Jose, Orange County, San Diego and Seattle, where supply shortages combine with steady demand.
Miracle Mile generates substantial investor interest
Los Angeles’ positive absorption of 4,017 units during the second quarter marked a 14.2 percent increase compared to the previous three-month period, reflecting the market’s growing demand, according to a CBRE report.
Multifamily transaction volume likewise grew, rising 33.3 percent to $1.6 billion quarter-over-quarter as of June. Miracle Mile was among the submarkets that generated investor interest, with Prime Group paying $51.2 million for the 132-unit Palm Court. Harrison Properties sold the asset, Yardi Matrix reveals.
The neighborhood continued to create investment opportunities well into the third quarter, even outside Decron Properties’ deal. Just last month, Pacific Urban Investors paid $70.5 million for Milhaus’ 169-unit The Preston, the data provider shows.
