The largest apartment community on the West Coast has received a $947 million loan.
Newmark Group Inc. represented borrower Prime Residential in the loan for the Park La Brea apartments. The financing will allow the company to retire its existing debt and is being secured by Freddie Mac’s K-Deal program.
Newmark’s Mitch Clarfield, Ramsey Daya, Chris Moritz and Alec Newman led the financing.
The Park La Brea, which sits at 6200 West Third St. near The Grove, has 4,249 units spread across 18 high-rise towers and 175 garden-style buildings. Roughly 10,000 residents live in the 144-acre community.
“Park La Brea, the largest housing community west of the Mississippi, is an iconic Los Angeles asset. This was a historic financing that contains a variety of custom features, including the flexibility to construct a significant number of Accessory Dwelling Units (ADUs) on the property, which will contribute towards addressing the state’s housing and affordability crisis,” Clarfield said in a statement.
Accessory dwelling units, colloquially known as granny flats, are being used by many to create additional housing units. Prime did not immediately return a request for information on its ADU plans.
Clarfield said he has worked with Prime Residential for more than a decade. Freddie Mac had the existing debt on the property, which was going to mature soon. Clarfield said Prime was interested in the new Freddie Mac loan because of “the ability to close the transaction at the quoted terms.”
He added that because Freddie Mac had the existing debt on the property it had already vetted it, which made the loan easier to close on schedule and “gave Prime a lot of confidence.”
“By continuing to support financing for Park La Brea, we are ensuring that many families have a safe, affordable place to live in this historic community,” Steve Lineberger, vice president at Freddie Mac Multifamily Production and Sales, said in a statement. “Working with two great partners in both Newmark and Prime Residential, we are pleased to continue to help support workforce housing via this vital multifamily community that has been home to so many since the 1940s. We look forward to continuing to support liquidity, stability and affordability to the multifamily market through these types of transactions across the country.”
Park La Brea was developed by MetLife from 1941 to 1950. Prime Residential has owned the property since 1955. It is 95.5% occupied and is a rent-controlled asset. Clarfield said the property’s next rental increase would come in February.
