It's not often that more than 700,000 square feet of downtown properties change hands in one fell swoop, especially when they've been in the same family for decades.
But that's what happened recently when real estate investor Gerry Properties sold nine "garment loft" buildings encompassing 711,849 rentable square feet to local real estate investor Mark Weinstein. The purchase price was about $18 million, according to real estate sources.
"(Weinstein) instantaneously became one of the largest property owners downtown of garment-industrial space," said Bradley Luster of Major Properties, who represented buyer and seller. "These things never sell. It's a rarity when an outsider can get in and buy something."
Arthur Gerry said his decision to sell came about because he "decided to retire."
The garment district properties are in the 700, 800 and 900 blocks of Los Angeles Street, as well as on Santee Street and East Eighth Street. They range in size from 71,359 square feet to 107,500 square feet.
The Los Angeles Street buildings between Seventh and Eighth streets were built by philanthropist Michael Connell, who willed them to USC upon his death. Gerry Properties acquired them from USC in 1963. Gerry built the largest of the nine buildings, at 910 S. Los Angeles St., in 1946 and bought the remaining real estate during the 1950s.
Most of the buildings have ground-floor retail and office garment manufacturing space on the upper floors, Luster said.
The buildings are almost fully occupied, mostly with Korean tenants, Weinstein said. While they have been well maintained, Weinstein said he plans some upgrades and wants to add showrooms for Korean manufacturers.
"We want to fine tune, improve the aesthetics," he said.
Weinstein, who also owns the Santa Monica-based property management firm MJW Investments, has been on a buying spree over the past 16 months, spending $80 million on local properties, including apartment buildings in Koreatown and a shopping center in Santa Clarita.
Big tenant decision
Pacific Bell Directories is considering moving its Southern California headquarters to Burbank, Pasadena or downtown Los Angeles. The division currently leases 130,000 square feet in the Mid-Wilshire district, at 3470 Wilshire Blvd., and is considering remaining there as well, said Brad Feld of Cushman & Wakefield Inc., which is representing Pacific Bell.
About 400 employees work at the division's Southern California headquarters, which handles the sales, administration and operations for the Smart Yellow Pages. Its lease expires in July 1999 and Pacific Bell expects to reach its decision by October.
As part of a move from large, centralized operations to "constellation offices," Ernst & Young LLP has signed leases encompassing 230,000 square feet in four locations: Citicorp Plaza in downtown L.A., Pacific Corporate Towers in El Segundo, Warner Center Phase V in Woodland Hills and Riverside Centre in Riverside.
The largest transaction was its 135,500-square-foot, 15-year lease at Citicorp Plaza, which will be renamed Ernst & Young LLP Plaza. (Citibank has relocated to 444 S. Flower St.)
Craig Cahow and Michael Escalante with TrizecHahn Office Management represented TrizecHahn, owner of the property.
The second transaction involved a 10-year lease for 56,632 square feet at Pacific Corporate Towers, which Ernst & Young selected because of its proximity to L.A. International Airport. John Ayoob, with CB Richard Ellis, represented the landlord in that deal.
The Big Five accounting firm's geographic expansion is part of its "workplace of the future" strategy, which grew out of a multi-year study. The goals are to reduce employees' commute times to a maximum of 30 minutes during rush hour and to be closer to clients, said Kevin Kelly, area director of human resources.
All 1,500 E & Y; employees in the L.A. and Inland Empire areas including those in the firm's Century City, Long Beach and Westlake Village offices will be able to use the new offices when doing business in those areas of town.
Cushman Realty Corp. represented Ernst & Young in the transactions. Brain Ulf, Edward Simpson and Joshua Wrobel were on the special project team that completed the transactions.
Sarofim Realty Advisors of Dallas has sold the office building at 888 W. 6th St. to Pacific Eagle Holdings Co., which is based in San Ramon, for $17 million. The 98,000-square-foot building is 75 percent leased. Hayden Eaves and Richard Plummer with Cushman & Wakefield represented the buyer and seller.
Thaya Communications Inc./Q-Financial Inc. has subleased 22,910 square feet of office space at the Library Tower in downtown from White & Case LLP. Terms of the seven-year sublease were not disclosed. Thaya, which does financial marketing, has its corporate office in Century City. It also decided to open a second office downtown in response to increasing business and a desire to be closer to the banking community. Kevin Keating of Cushman & Wakefield represented White & Case, an international law firm, and Daniel Miller of Capital Commercial/NAI represented Thaya. BMK Inc., a warehouser and distributor of products primarily for the grocery industry, has signed a 10-year lease valued at $6 million for 170,000 square feet of distribution space in the City of Commerce. About 50 employees work at the new facility in the Chartwell Distribution Center. Dan Sibson of Investment Development Services Inc. and John Privett of CB Richard Ellis represented Chartwell Investment Co., the landlord. Paul Sablock and Steve Calhoun of the Seeley Co. represented BMK. Protection One Alarm Monitoring Inc., the second-largest security service in the nation, has doubled the size of its offices with its move to 600 Corporate Pointe in Culver City, where it has leased 23,520 square feet on the top floor. Westmac Commercial Brokerage Co. represented both the owner, Arden Realty Inc., and Protection One.
Staff Reporter Elizabeth Hayes can be reached at (323) 549-5225 ext. 229.
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