The West Valley submarket exploded last week with a cumulative $540 million in real estate deals.
In one of the region’s largest apartment transactions of the year, Denver-based Apartment Investment and Management Co. sold the 1,279-unit Warner Center Apartments, which sit upon nearly 30 acres in Woodland Hills, to Troxler Residential Ventures LLC and MacBeth Properties Inc. for more than $300 million.
The purchasers plan to renovate the buildings before converting the apartments into condominiums. Residents will have first priority to purchase their homes when their leases expire, said Brian Troxler, managing member of Woodland Hills-based Troxler Residential Ventures.
“No one will be forced to move out, even as construction improvements are phased in,” he said.
Elsewhere, owner BentleyForbes chose JPMorgan Chase & Co. as the buyer of one of the submarket’s trophy buildings, Warner Center’s 21st Century Plaza, in a deal valued at more than $130 million, according to knowledgeable sources.
The 518,000-square-foot tower isn’t under contract, sources said, and the deal could still fall apart while JPMorgan completes its due diligence.
CB Richard Ellis Inc. Senior Vice President Tom Bohlinger, who has the listing, declined to discuss its status. He said the recent spate of deals show investors have been paying attention to the area.
“The market has rapidly shrinking supply because of all the positive absorption,” he said. “I think people believe you’re going to see strong rent growth over the next two or three years there.”
Buying its first properties of the year, publicly traded Arden Realty Group Inc. struck a deal for the 254,000-square-foot Warner Corporate Center in Woodland Hills for about $64 million from London-based Grosvenor Group Holdings Ltd., in a transaction set to close Oct. 20.
CB Richard Ellis Executive Vice President David Doup & #233; represented Grosvenor on the deal, but declined comment.
Arden also agreed to purchase the Homestore Inc. headquarters in Westlake Village for $32.3 million from Miller Bros. Russell Ranch Road LLC.
Grubb & Ellis Senior Vice President Kevin Shannon, along with colleague Tom Festa, represented both sides on the deal.
In another office deal, Younan Properties Inc. flipped WarnerView Corporate Center for a $3.1 million gain. Value Home Loan Inc. purchased the three-story, 62,000-square-foot office building for $12.5 million.
New Millennium
A final decision is looming for Apollo Advisers LP’s controversial Sunset Millennium hotel and residential development.
The environmental impact report has been released for the project, which sits on a four-acre parcel straddling La Cienega and Sunset boulevards.
With the report now public, it sets up a possible go-ahead by the West Hollywood City Council by year’s end, according to Ray Reynolds, the city’s economic development director.
“The project is pretty dramatically different,” Reynolds said. “It’s two hotels rather than one, and there is no office component in this version but there are 190 units of residential (condominiums) in two buildings.”
The newest version also proposes building another 1,200 parking spots in an underground garage that will run the length of the project, connecting the hotels and condo towers via a tunnel under La Cienega Boulevard.
The development’s first phase, a collection of shops and restaurants with more than 800 underground parking spaces, formally opened last month.
The second phase of the project is expected to cost upwards of $300 million to complete, said Richard Ackerman, the Apollo partner in charge of the firm’s L.A. office.
Dealing Hyatt
A buyer has emerged for the Hyatt Regency Los Angeles.
Grain giant Cargill Inc. and Beverly Hills-based Kennedy Wilson Inc., the partnership that bought the hotel, along with an adjacent office building and mall, have entered into negotiations to sell the 485-room property to an unknown buyer for about $38 million, according to sources with knowledge of the deal.
Sources working on the deal wouldn’t disclose the identity of the buyer out of concern that Unite HERE Local 11, which is in contentious contract talks with hotel owners, would interfere in the deal.
One source described the potential new owner as an “institutional buyer not connected to the hotel business.”
However, the source said the new buyer intended to sink $7 million into renovations and keep the operation as a hotel. There had been speculation the Hyatt would be converted to condominiums.
It’s unclear whether Chicago-based Hyatt Corp. would retain the management contract, which expired more than a year ago, sources said.
At $78,000 a room, the hotel is trading at a discount of about 30 percent for a downtown luxury hotel, said Alan Reay, president of Costa Mesa-based Atlas Hospitality Group Inc.
“It’s low, but the issues it has a low operating income and union troubles has put downward pressure on the price,” he said.
Comcast Lease
G4TechTV, a cable network subsidiary of Comcast Corp., has renewed its lease and expanded to 125,000 square feet in the Westside Media Center in a deal valued at $20 million.
It’s another step in the turnaround for Kilroy Realty Corp.’s Westside Media Center, which was dealt a blow when original tenant eToys fell through on leasing the entire building when it opened in 2000.
Madison Partners principals Chris Houge and Hunt Barnett represented Kilroy on the deal, and Rick Buckley, another Madison Partners principal, represented G4TechTV.
Staff reporter Andy Fixmer can be reached at (323) 549-5225, ext. 263, or at
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