Purchase to Result in New Look for Old Whittwood Mall
Real Estate by Danny King
Whittier as the next Pasadena?
Hopkins Real Estate Group wants to pull that off, turning Whittier's largest single commercial property into an open-air mixed-use development along the lines of Paseo Colorado.
Newport Beach-based Hopkins is buying the 880,000-square-foot Whittwood Mall from Lusk Co. The purchase price for the 65-acre site, which includes anchor tenants such as Sears, J.C. Penney and Vons, was not disclosed.
No retail properties in Whittier have changed hands since the beginning of 2000, according to Marcus & Millichap. Comps in the Cerritos/Downey/Norwalk/Whittier retail property market range widely from $50 a foot to $250 a foot, with most properties selling in the $80 to $100 foot range.
"We're going to make it more of an open-air town center," said Larry Weese, Hopkins' senior vice president. He said a multifamily housing component would be added to the site but would not disclose a dollar figure or time frame for proposed improvements. "We'll do it as fast as we can do it."
Built in 1954, the barbell-shaped enclosed mall at Whittier Boulevard and Santa Gertrudes Avenue is the city's largest shopping development, dwarfing the 433,000-square-foot Quad at Whittier two miles to the west.
"It's a mall that's been under-performing for years," said Chris Maling, senior director at Marcus & Millichap. "It needs to be repositioned."
Up and Down
What a difference five blocks makes.
Developer Richard Weintraub, facing opposition from both neighbors and the L.A. City Council to proposed changes to a planned luxury condominium at Wilshire and Malcolm in Westwood, has seen things go more swimmingly a few blocks west, where he just sold an 80-unit apartment complex for $22.5 million.
10530-40 Wilshire Boulevard LLC, of which the Malibu-based developer is a partner, bought the building for $8 million in 1997 and spent $4.5 million on renovations. It sold for "fairly close" to its asking price of $22.5 million, according to Hamid Soroudi, senior managing director at Charles Dunn Co.
"It's a totally different property than when he bought it," said Soroudi, who represented both the seller and the buyer, an affiliate of the Roberts Co. on the deal. Roberts owns and manages 48 apartment complexes throughout the Westside. 10530-40 Wilshire Blvd. is its 11th property in Westwood, but the first along the Wilshire Corridor.
Rents in the building, which was built in the 1950s, range from $1,250 for a single up to $2,700 for a two-bedroom.
That project off his plate, Weintraub is dealing with expanding the scope of the development site. It is entitled for one nine- and one 14-story building at Wilshire and Malcolm, and he's seeking approval to expand it to 30-plus stories. The next step is an appearance before West Area Planning Commission July 17.
Small Follows Big
For M. David Paul & Associates, which had been holding off signing smaller tenants to its Pinnacle office development in Burbank while sought the big tenant, the wait is over.
Warner Music Group's $120 million, 195,000-square-foot lease at the 425,000-square-foot Pinnacle was expected to precede a spate of smaller deals.
Three tenants totaling 30,000 square feet are within weeks of signing deals, said Carl Muhlstein, senior director at Cushman & Wakefield, Pinnacle's principal leasing agent. Activity has heated up because the landlord now has a better sense of the building's internal flow. The big deal at Pinnacle, where construction was completed at the end of the first quarter, was also a boon to the greater Burbank leasing market.
With the Warner lease at the project, at 3300 3400 W. Olive Ave., Burbank's year-to-date net absorption was pushed well into positive territory, according to preliminary second quarter figures from Grubb & Ellis Co. While Glendale and Pasadena have put 48,500 square feet and 106,300 square feet back on the market, respectively, Burbank, with the Warner deal, has absorbed 217,000 square feet.
"There's never been that big a swing between those markets," said Bill Boyd, senior vice president at Grubb & Ellis. "It's never been this disjointed."
In and Out
While the Southern California housing shortage continues to drive up prices of single-family homes and apartment complexes, one Sherman Oaks investment group has gone contrarian.
11239 Ventura LLC sold two apartment complexes in Riverside to bankroll the purchase of the 108,000-square-foot Studio Center Place on Ventura Boulevard about a mile west of Universal City for $21.2 million. The center, anchored by Marshalls and Office Depot, is fully leased, with rents averaging about $1.65 a foot.
"They improved their location by (the property's) being closer to them and their cash flow is improved," said Charles Dunn's Soroudi, who estimated the center's capitalization rate at 9.3 percent. Capitalization rates for apartments in the Studio City market are between 7 and 8 percent, said Soroudi.
Charles Dunn's David Ickovics and Stacy Vierheilig-Fraser represented the seller, Studio City Associates LLC.
J.H. Snyder Co. has brought on Westside real estate veteran Gary Weiss to handle leasing the 1-million-plus-square-foot NoHo Commons mixed-use project. Weiss, who headed Credit Suisse First Boston's local commercial real estate services group before the division was shut down in January, has signed on as senior vice president of the Miracle Mile-based developer.
"After 16 years in the business, I wanted to do something a little more entrepreneurial with a lot more upside earning potential," said Weiss, who had been a leasing broker for Julien J. Studley Inc. before his stint at CSFB.
In addition to NoHo Commons, which should break ground in the next 12 months, Snyder has begun work on an 85,000-square-foot mixed-use project in Agoura, has scheduled groundbreaking for a 200,000-square-foot retail center at Santa Monica Boulevard and La Brea Avenue in two months and is pursuing investment opportunities in the $20 million to $80 million range.
Staff reporter Danny King can be reached at (323) 549-5225 ext. 230, or at firstname.lastname@example.org.
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