Lake Balboa Apartments Sell for $9.75 Million

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A 52-unit apartment complex in Lake Balboa near Van Nuys has changed hands for $9.75 million.

Chicago-based Orix Real Estate Capital Inc., an entity of Japanese finance company Orix Corp., purchased the building from Terraces at the Lakes LLC of Agoura Hills, an entity of real estate asset manager Shuster Properties.

The 16550 Vanowen St. property called the Lakes was built in 1988. Orix paid $187,500 per unit in what is being called a market-rate sale. The transaction closed in late January.

The apartment complex is not protected by any rent control ordinance; it includes 28 one-bedroom and 24 two-bedroom units. Nearly two-thirds of the apartments have been remodeled recently.

“The architecture is very interesting, it has a great unit mix,” said Dave Casper of Hendricks & Partners Inc., who represented both sides of the deal.

Orix typically purchases apartment buildings like the Lakes on behalf of Japanese investors, Casper said. Recent legislation in Japan makes this sort of apartment investment attractive to high-net worth Japanese real estate investors. In addition, rising foreclosures and the declining housing market have increased the pool of renters, driving up rental rates.

Karoline Sauls of Hendricks & Partners also represented both sides of the deal.


Marina del Rey Deal

Gravity Interactive Inc., the local arm of a South Korean developer and publisher of online video games, has signed a lease for creative space in Marina del Rey.

The five-year deal with building owner Hankey Investment Co. LP of Los Angeles for 21,775 square feet at the Marina Business Center is valued at about $4.5 million.

The 276,000-square-foot, three-building business center at 4499 Glencoe Ave. was a good fit for Gravity Interactive, a unit of Seoul, South Korea-based Gravity Corp., said Chris Strickfaden, managing director of Jones Lang LaSalle Inc.

The firm had been subleasing about 6,000 square feet in an adjacent building, but liked the Class A Marina Business Center because it is a converted and rehabilitated industrial complex.

“They don’t want stifling cubicle space with low ceilings,” said Strickfaden, who represented the tenant in the deal. “Their (software) engineers are in that sort of creative mode, they are inspired by creative spaces.”

Gravity Interactive’s space accounts for about half of a three-story, 46,238-square-foot building. The rental rate in the deal starts at $3.50 per square foot per month on a full-service gross basis and escalates at a rate of 3 percent annually, according to an industry source with knowledge of the transaction.

“The alternatives were to go to El Segundo for this tenant and pay probably a dollar a foot less and not be in creative space or go north to Venice or Santa Monica and pay $5 a foot,” Strickfaden said.

The property owner, Hankey Investment, is a unit of Hankey Group, headed by Don Hankey, a local real estate owner and investor. The complex owner was represented in-house by Scott Dobbins. The deal closed in January.


Neo-Historic Listing

A new West Hollywood apartment building in a historic area of the city has been put up for sale and could fetch a high price despite the market downturn.

The 7 Fountains property at 1414 N. Harper Ave. is in the protected Harper Avenue Historic District, which features several old Spanish-style residential complexes with gardenlike courtyards. The building only opened in the summer of 2002, but was built by local developer Boyd Willat to resemble the nearby historic properties.

Including land costs, Willat spent over $15 million on the project, which includes a total of 30,000 square feet of living space and several courtyards with landscaping and seven fountains.

Andrew Levant, senior vice president at George Smith Partners Inc., who has the listing, believes the 20-unit property could fetch over $20 million, even though the region’s housing and real estate market continues to suffer from a protracted slump.

“There is a flight to quality, and irreplaceable, one-of-a-kind, high-quality assets. It has a lot of upside potential depending on who the buyer is,” he said.

The project has a condo tract map in place, but is being operated as an apartment building and is 95 percent occupied.

Willat has an early connection to the property; it once housed Harper House, the compound of Hollywood producer Irwin Willat, the developer’s father. The Harper House was torn down to build 7 Fountains.

Staff reporter Daniel Miller can be reached at

[email protected]

or (323) 549-5225, ext. 263.

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