Editor's Note: This article has been corrected to report that Palisades Capital Partners is based in Beverly Hills.
One of the last large land parcels near downtown Los Angeles, a 5.3-acre plot that was owned by a Korean Presbyterian church, has sold to a Beverly Hills developer.
Palisades Capital Partners shelled out roughly $30 million for the large site at 1111 W. Sunset Blvd. in Echo Park, right at the border of downtown Los Angeles.
Palisades plans to redevelop the site, which includes a sanctuary and several other abandoned buildings, into a mixed-use residential project with retail facing Sunset, said Philip Sample of CBRE Group Inc., who represented both the buyer and the seller in the transaction. Official plans have not been submitted.
Palisades could not be reached for comment, and sources said the firm has already acquired several properties in Los Angeles. In March, Palisades posted a job listing to the Los Angeles Chapter of the American Institute of Architects’ website, looking for an associate project manager. In that posting, the company described itself as “currently developing high-end residential and mixed-use projects in Santa Monica, Westwood and Beverly Hills.”
The seller, Holy Hill Community Church, was in bankruptcy, it was reported last year, and the church was put up for sale to get it out of debt. Richard J. Laski was appointed by the U.S. Bankruptcy Court to sell the site on behalf of the church as part of its reorganization under Chapter 11 of federal bankruptcy laws. Now that the sale is complete, he will go through the arduous process of addressing all of the claims filed against the church and paying back its debts. The church will receive the remainder of the $30 million that is not owed to creditors, Laski said. It will use that money to purchase a new home for its congregation.
“This was a dysfunctional church, and so this is a case where bankruptcy proceedings benefited everyone and allowed the church to stop worrying about creditors and start worrying about being a church,” Laski said.
The campus was once the headquarters of the Metropolitan Water District. It was acquired by the church in 1994 for $8.1 million. Before it declared bankruptcy, the church sold a building on the site to downtown developer Linear City in 2011 $6.8 million. Linear converted that property, a 110,200-square-foot office building at 1115 W. Sunset Blvd., into the upscale Elysian Apartments. That development was not part of the deal with Palisades. Most apartments at the Elysian rent between $1,800 and $3,000 a month, according to Linear principal Yuval Bar-Zemer. The penthouse, however, rents for $6,500 a month.
Those rents were encouraging to Palisades Capital, Sample said, adding that the buyer was sold on the location and the potential for building a multi-story property with views.
“The best thing about the site is the topography,” Sample said. “It sits up over downtown and you get a view into the downtown horizon. From the top of the Elysian, you can see the ocean.”
Mike Shustak and Chris Caras of CBRE also represented both the buyer and the seller in the transaction.