Spurred by the successes of the developers with whom they've worked, two contractors are jumping headlong into the downtown loft business.
Frank Gamwell and Bud Hawley formed Oxford Street Properties earlier this year as the development arm of Gamwell's general contracting company, PCM.
The pair so far has secured deals for two projects totaling $12 million and has its sights set on more.
"All of the apartments downtown are 95 percent leased and that's conservative," Hawley said. "There is virtually no available product on the market."
Gamwell and Hawley's venture received a $2 million infusion from a European investor, whom they declined to identify, toward the $4.5 million purchase of the Stock Exchange building at Seventh and Spring streets.
The deal for the building is expected to close by November and involves turning the 8,000-square-foot fifth-floor boardroom and the four-floor tower rising out of the main building into 40 apartments.
Gamwell said his experience as general contractor on developer Tom Gilmore's Bank District lofts will help make his own projects work and with fewer headaches.
"I think we've learned where lots of the pitfalls are with this kind of work," he said. "We know the things that designers do that will not satisfy the city."
Gamwell and Hawley are jumping into one of the hottest markets for new residential development in the city. At the end of 2000, there were more than 1,100 existing loft-style apartments downtown and plans were on the table for another 1,500 in 14 more developments, mostly adaptive reuses of existing property, according to L.A. Downtown Center BID data.
The fledgling developers made their first move into the business earlier this year with a $6 million partnership with Kor Realty Group in the Sante Fe buildings at Main and Sixth streets.
In their latest deal, an agreement with the owner of the Irvine Byrne building at Third Street and Broadway, Oxford will convert the 1894 relic with ground floor retail into 48 apartments. The owner, Moses Lerner, decided to remain as a limited partner in the project and will turn over the property to Oxford.
"The more that happens the more interest there is going to be," said Wade Killefer, a partner at Killefer Falmmang Purtill Architects of Santa Monica and perhaps the busiest architect when it comes to designing loft apartments downtown. "We could absorb 30,000 units. There's no housing in L.A."
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