Long Beach Senior Affordable Community Finally Holds Groundbreaking

By Alex Girda, Associate Editor

A major step was taken to ensure that an important residential development in Long Beach will have new life following a number of funding delays due to redevelopment legislation. However, the Ramona Park senior affordable housing development has managed to pull through and recently held a groundbreaking ceremony, confirming the local market’s need for projects of its kind. The affordable housing community is being handled by Palm Communities and Western Community Housing, a nonprofit organization that specializes in affordable housing projects.

Ramona Park Senior Apartments will be a 60-unit housing community for residents that are over the age of 55 and earn less than 60 percent of the area’s median income. Located at 3290 E. Artesia Boulevard, in the immediate vicinity of Ramona Park, the development will feature 48 one- and 12 two-bedroom residential units. The community’s amenity package will feature a common courtyard, a pool, picnic area, spa, fitness facility, fire pit, classroom, rec rooms and other common rooms including a computer room, dining area, and library. The development process will employ standards reaching minimum LEED construction requirements, as well as local green building regulations.

Financing for the project was partially raised with $7 million in low-income housing tax credit equity from WNC, an entity dealing with community development projects across the U.S. That measure is a federal tax facility that acts as an incentive for developers aiming to construct affordable rental housing communities for low-income residents. The total development cost for the Ramona Park Senior Apartments will reach $22.5 million by the completion date set for April 2014.    

New Renaissance Hotel will Join Already Impressive Hospitality Roster at L.A. LIVE

By Alex Girda, Associate Editor

The L.A. Live development has reimagined a troubled area of downtown Los Angeles by injecting a new sports and convention space-anchored complex. The revitalization of the area surrounding the STAPLES Center seems to be a success as the company responsible for the L.A. LIVE concept, AEG, recently sold a 60,000-square foot land parcel to Williams/Dame & Associates which will be used for a new hotel project. The reported investment would be of around $200 million, and the developer intends to operate the venue as a Renaissance Hotel, one of the brands under the Marriott International canopy.

The 450-key facility will be located at the northeast corner of Olympic Boulevard and Georgia Street. This would be the fourth hospitality spot to be operated under a brand owned by Marriott International in the area. The new Renaissance Hotel joins an existing 123-key, 5-star Ritz-Carlton Los Angeles Hotel owned by AEG, the JW Marriott Los Angeles LIVE Hotel featuring 878 rooms, and two other properties currently in development that will be part of a 24-story high-rise scheduled to open in July 2014, both owned by Williams/Dame & Associates and American Life, Inc. When completed, the two hotels will add around 400 rooms to the area’s Marriott-operated inventory.

With the new Renaissance Hotel beginning construction in Q1 of 2014 and a completion date set for 2016, the L.A. LIVE area looks forward to offering a plethora of hotel options, with 1,844 rooms featuring five different Marriott brands: Ritz-Carlton, Renaissance, JW Marriott, Courtyard and Residence Inn. The venues will ensure that visitors will have a variety of hospitality options when checking out one of the many attractions of the entertainment district: STAPLES Center, the Los Angeles Convention Center, Nokia Theatre L.A. LIVE, Regal Cinemas and the GRAMMY Museum.

Image: L.A. LIVE, courtesy of lalive.com

Bixby Office Park Acquired for $85 Million; TIAA-CREF Expands Portfolio With Industrial Purchase

By Alex Girda, Associate Editor

It was recently announced that the Bixby Office Park has been acquired by a private, fully integrated real estate investment company. Parallel Capital Partners sealed a deal worth approximately $85 million to secure the commercial asset in Seal Beach, CA. This constitutes the largest office transaction in Orange County in 2013. The seller was a large national insurance company, represented by an Eastdil Secured team consisting of Adam Edwards and K.C. Scheipe. The buying entity was PCPI BIXBY LP, an affiliate of Parallel Capital, which represented itself.

The 297,200-square foot complex occupies a 16-acre lot at 3001-3005, 3010, 3020 and 3030 Old Ranch Parkway, in close proximity to the 405 Freeway. Originally developed in 1987, and featuring an above average occupancy rate of approximately 98 percent, the complex features a tenant roster including names such as Baker Corp, SAIC, Olson Urban Housing, Seagate Offices and Clean Energy Fuels Corp.

In other real estate news from the area, TIAA-CREF recently completed the acquisition of an industrial property in Carson. Located at 16325 S. Avalon Boulevard, the multi-tenant warehouse and distribution asset offers up 210,700 square feet of leasable space. The property was bought from Trammell Crow, an entity specializing in the sale of completed spec developments to investors.

The value of the transaction made by Teachers Insurance and Annuity Association – College Retirement Equities Fund was not disclosed. The facility is a Class A commercial real estate property that was developed on a land parcel bought by Trammell Crow back in 2011 from Evergreen USA. The company later developed the property which features 26 loading docks and 32-foot-high ceilings and is pending LEED Silver certification.  

Image courtesy of bixbyland.com

Creative Office Building in Santa Monica Secures Refinancing Deal as Silicon Beach Concept Gains Traction

By Alex Girda, Associate Editor

Holiday Fenoglio Fowler recently announced that it has provided a refinancing plan to The Luzzatto Company, Inc. and Welk Real Estate, Inc. HFF arranged $14 million for the property located at 2700 Pennsylvania Avenue, a creative office building in one of the country’s budding markets for tech-oriented tenants. With Microsoft as the latest company to express its interest in Silicon Beach, a number of office space owners are looking to recapitalize on their local assets in order to make sure that their properties will be among the ones that bring in the next big tech names to the area.

2700 Pennsylvania Avenue is a 62,000-square-foot creative office building that will benefit from its proximity to the upcoming Bergamot Station on the Expo Light Rail line, when it opens in 2015. The building has a 100 percent occupancy rate with its two lease holders Yahoo! and Jakks Pacific. HFF secured a seven-year, fixed-rate loan through Principal Real Estate Investors on behalf of Welk and The Luzzatto Company through its debt placement team led by Director Chris Vittetoe and Real Estate Analyst Steven Paskhover.

2012 was a positive year for Santa Monica’s office sector, with vacancy rates not exceeding an average rate of 10.3 percent. Q3 was by far the best timeframe for the area in terms of occupancy with only 9.6 percent of the total office space in the area being left unoccupied. Q4 saw a slight bounce in vacancies; Santa Monica finished 2012 with an average vacancy rate of 10 percent, according to data compiled by Reis Reports, a provider of commercial real estate performance information and analysis.

Market Data Courtesy of Reis Reports

SKECHERS Distribution Center Becomes Largest LEED Gold Building in the U.S.

By Alex Girda, Associate Editor

A distribution center operated by footwear manufacturing company SKECHERS has received U.S.G.B.C. LEED Gold certification. It is the largest LEED-certified building in the country to have achieved Gold status. According to SKECHERS CEO and CFO David Weinberg, the company “is committed to growing its business in a way that conserves natural resources, protects the environment and reduces waste,” therefore the development process, handled from planning through construction by Highland Fairview, was focused on sustainability from the start.

The 1.82 million-square-foot distribution center located in Rancho Belago, CA had a number of green technologies employed in its construction process, as well as environmental features built into the end product. Some of these eco-friendly measures include: the accommodation of 280,000 square feet of solar power generation systems on the building’s roof, motion sensor-regulated lighting that partly uses solar-power, a facility-wide ventilation system that uses air drawn through louvers facing the prevailing winds, as well as similar heating and cooling systems, a white “cool roof” and light colored pavement that reduce heat emissions, water efficient and drought tolerant landscaping that reduces irrigation by half, low voc-emitting paints, coatings, glues.

Recycled and regional building materials that reduce the carbon footprint of the construction process were employed, as well as a recycling process for most of the byproducts that resulted from building operations.  

Officially started in the spring of 2010, SKECHERS’ new facility opened its doors in November 2011. The facility includes 20,000 square feet of office space used by the company, as well as a retail operation dealing with the company’s signature footwear products.

Image courtesy of businesswire.com

Microsoft Strengthens Retail and Office Presence in Westside Tech Submarket

By Alex Girda, Associate Editor

As Microsoft continues its steady expansion into the retail world, the company is also gaining a stronger footing in major tech hubs. With upcoming real estate deals the Redmond, WA-based tech giant has lined up, it is poised to expand its Los Angeles office space presence. The company is close to completing two different leasing deals in the city’s growing Westside technology-driven submarket.

According to The Los Angeles Business Journal, Microsoft’s entertainment division, the one responsible for the massive gaming hit that is the Xbox console, is preparing to carve out new office space at 520 Broadway in Santa Monica. The amount of space that Microsoft would be taking over once the deal is finalize has not been disclosed.

The second move that the company is looking to finalize is a brand new 25,000-square-foot office lease at 13031 Jefferson Boulevard in Playa Vista. Microsoft is ready to move its customer-focused software and sales teams from downtown L.A. to this more tech-centric setting. In fact, the organization looks eager to move most of its operations to the city’s Westside, in order to get in on the revived Silicon Beach surge.

Clues regarding Microsoft’s intentions were revealed as early as November 2012, when the company further expanded its already growing retail presence with an 11,000-square foot lease in Venice. The new retail spot offers the company visibility in that area’s flourishing tech market, and it also paves the way for its current office moves. The aggressive retail moves that Microsoft has made recently clearly highlight its new persona as an integrated technology provider rather than a core software provider, emulating the blueprint for success of its competitor Apple.

Image courtesy of Google Maps 

Hyatt to Take Over as Operator for L.A. Hotel Downtown as Hospitality Giant Continues L.A. Push

By Alex Girda, Associate Editor

One of the best known hotels in downtown Los Angeles is set to undergo a major renovation and rebranding process over the next few months. Owned by China-based Shenzen New World Group, The L.A. Hotel Downtown will don the Hyatt Regency brand. The property will reopen this May under the name Hyatt Regency Los Angeles Downtown. The reported value of the rebranding and renovation process will be approximately $20 million.

L.A. Hotel Downtown is a 491-key hospitality property in the central part of Los Angeles, and the move by Hyatt to take over as operator of the facility is part of its more aggressive stance in the greater Los Angeles area. It was recently revealed that Hyatt would be the new operator of the Century Plaza Hotel in Century City, another major hotel renovation project.

The end product will include a number of upgrades to the building and the amenity package, including new floor plans for the 17 separate meeting and event rooms totaling 22,000 square feet. Included are two ballrooms and 4,000 square feet of pre-function space. Rooms will feature a new minimalistic design and color palette with bright red, orange and beige motifs. Also, guest rooms will be rethought with new carpeting, new wall treatments, revamped bedding, new furnishings and redesigned bathrooms and work areas.

L.A. Hotel Downtown offers easy access to nearby city landmarks such as L.A. Live, Staples Center, Walt Disney Concert Hall and the headquarters of a number of major corporations. Hotel management is currently handled by Interstate Hotels & Resorts.

Image courtesy of Google Maps 

Mill Creek Residential Announces New Glendale Luxury Apartment Community

By Alex Girda, Associate Editor

A new joint venture funded by Mill Creek Residential Trust LLC is poised to begin development on a Los Angeles-area residential project. MCREF Verdugo LLC recently completed the off-market acquisition of a 67,518-square-foot land parcel in Glendale, and it will proceed to use it as the site of a brand-new, 245-unit apartment community.

Located at 610, N, Central Avenue, the site will be the home of a new six-story, mid-rise, high-end apartment structure, one of the first properties of its kind for the developer. Resident amenities will include an underground parking facility, a resort-style pool and spa, an around-the-clock fitness center and yoga facility, and a resident clubroom featuring a kitchen and business center, as well as two rooftop decks offering views of the nearby Verdugo Mountains.

The construction is also groundbreaking in the sense that the funding will come through a newly established $400 million equity fund. Mill Creek Residential created the fund in order to aid its focus on the development of upper tier apartment communities in the real estate markets of Southern California.

According to the Managing Director of Mill Creek Residential for Southern California, Michael Genthe, “(the company’s) business model is to develop luxury rental communities on in-fill locations in desirable, well established cities like Glendale with above average population growth, strong employment characteristics, strong rental fundamentals and consistent and sizable institutional investment demand.” The representative also mentioned the fact that the construction deadline for the community is set for some time during 2015.

Image courtesy of Google Maps

Woodbridge Capital Partners, Oaktree Capital Management to Redevelop Century Plaza Hotel

By Alex Girda, Associate Editor

L.A.’s Century Plaza Hotel has been a staple of Century City, and now it will propel its iconic look into a new century with a recently approved redevelopment project. Next Century Associates, the entity in charge of a proposed $2 billion makeover plan for the site, recently got a unanimous go-ahead from the Los Angeles City Council for its ambitious initiative. The project is the result of a collaboration between conservation groups, homeowners, developer Next Century Associates and local authorities.

The current owner of Hyatt Regency Century Plaza Hotel is planning to develop 1.5 million square feet of mixed-use space on the six-acre adjacent site. Next Century Associates is a partnership created between Woodbridge Capital Partners and fund manager Oaktree Capital Management L.P.

The project calls for a two-tower residential complex that will also feature a 100,000 square-foot plaza including retail space and a dining area. Two acres of land would be transformed into public open space with fountains and courtyards. Pei Cobb Freed’s project design also includes the restoration of Century Plaza Hotel’s iconic arched building. The end result will be a development comprising 394 hotel rooms and 63 high-end residential units.

Construction at the Avenue of the Stars and Constellation Boulevard site would ideally start at the beginning of 2014 and would connect an area of approximately 10 million square feet, including attractions such as the Westfield Century City Mall. The area will benefit in the future from a metro station on the upcoming Westside subway line.

Image courtesy of user Minnaert via Wikimedia Commons

Mixed-Use Development Announced for Palms Neighborhood

By Alex Girda, Associate Editor

L.A.’s Palms submarket has seen its fair share of turmoil but important changes are slated for the Westside neighborhood after a recent report announces a new mixed-use development. Frost/Chaddock Developers has announced that work has commenced at its $30 million Palms apartment community that will use the proximity of a planned Expo Line light-rail station as its hook. The Expo Line is a Los Angeles County Metro Rail line between Santa Monica and L.A.’s downtown area. Frost/Chaddock’s new residential complex has a construction deadline set for May 2014.

According to The Los Angeles Times, the development was designed by Killefer Flammang Architects and will feature 115 residential units featuring studio and one-bedroom floorplans. Seventeen units will be designated as low-income housing, in keeping with the city’s initiative to deliver as much low-income housing to the market as possible.

Located at 3425 Motor Avenue, the five-story mixed-use development will feature street-level retail space and restaurants that will flank the entrance leading into a courtyard. Tenants will have access to a rooftop deck featuring a garden, as well as an underground parking facility. Aimed at young professionals willing to relocate to the Palms neighborhood, Frost/Chaddock’s new project is the second project of its kind to be announced in the submarket in a relatively short timeframe.

In 2012, the Westside Cities have had a completion rate that was far lower than recorded in the Greater Downtown area and Los Angeles. However the San Fernando Valley and South Bay both had extremely weak completion rates last year. With a number of projects in the pipeline for the Westside Cities, that rate should see some improvement in 2014 and 2015, with the strengthening market set to drive apartment projects forward.

Rendering courtesy of kfarchitects.com

Chart courtesy of Marcus & Millichap Real Estate Investment Services at marcusmillichap.com