Long Beach businessman Jim Brophy learned a lot about his city's lack of affordable workforce housing when he chaired the city's Neighborhood Development Task Force a few years ago.
Now with financial backing from a prominent local family, he's putting that experience to work to create a downtown residential development at the longtime home of the Long Beach Press-Telegram.
Brophy, managing partner of October 5 Development LLC, has partnered with the family that founded Long Beach-based managed care provider Molina Health Care Inc. to buy the Press-Telegram building this month from the paper's owner, Los Angeles Newspaper Group. The venture, Press-Telegram Lofts LLC, proposes to build 542 lofts on most of the city block at 604 Pine Ave. The deal's value is reported to be $20 million.
"We felt this was a prime property to add to the renaissance of downtown Long Beach," said Brophy, who added that Molina Chief Financial Officer John Molina and his wife Michelle have been the lead family members backing the project.
The draft environment impact report for the proposed 22-story twin tower complex is undergoing city staff review. The project will incorporate part of the 90,000-square-foot newspaper plant, which was built in the 1920s. Units are planned to start in the high $200,000s, with 60 units to be sold at cost to California State University, Long Beach for resale to tenure-track faculty who often have trouble finding affordable housing near campus.
"To find a parcel this large in the downtown that wasn't going to involve assembling several parcels with different owners was a great opportunity for the developer," said Bill Townsend at Long Beach-based INCO Company, who with partner John Sweeney brokered the deal after working with both parties separately for several years. "Pine Avenue is a dynamic street with lots of restaurants a few blocks to the south, a good middle-income neighborhood."
For the Press-Telegram's new home, newspaper management worked with Dave Smith of CB Richard Ellis Group Inc. to sign a 15-year lease on more than 42,000 square-feet about six blocks away at the ARCO Center, 300 Oceangate. The newspaper's 220 employees plan to relocate by early November.
The Press-Telegram has been printed at newspaper group's Valencia plant since the late 1990s and other uses for the building have been under consideration for years, said publisher Mark Stevens. It eventually was decided that it would be less costly to lease offices elsewhere than build a smaller building on the same site and sell the rest.
Hotel investment firm Maritz, Wolff & Co. has found a buyer for Santa Monica's historic Fairmont Miramar, signing a contract earlier this month for more than $200 million. Texas computer billionaire Michael Dell's private equity firm reportedly beat out four other bidders.
Neither the firm's Los Angeles-based chairman, Lewis Wolff, nor Dell's New York-based MSD Capital LP would confirm that MSD was the buyer prior to the close of the deal, which is expected to take place in the next 60 days. However, MSD clearly seems to be on the lookout for hospitality acquisitions, given it recently purchased in a joint venture Hawaii's 865-acre Hualalai Resort. Dell is founder and chairman of the world's largest personal computer maker, Dell Inc.
The 302-room Miramont is Maritz Wolff's third recent divestiture, with Fairmonts in Kansas City, Mo., and Austin, Texas, selling earlier this year and a fourth unnamed property likely to be listed later this year. Wolff said the firm he owns with partner Phillip Maritz still has ownership interests in 10 hotels and half of the Rosewood Hotels & Resorts chain, and has no plans to disband or be acquired anytime soon. But the company is less likely to add properties now that his partner Maritz is heading a new hospitality industry team at Palo Alto-based Broadreach Capital Partners LCC. Broadreach is better known for turning around under-performing office properties, including several in Los Angeles.
Three Maritz Wolff executives have joined Maritz at Broadreach, and Wolff said that he's also a senior advisor to the team. Wolff has his own Northern California ties as lead owner of the Oakland A's Major League Baseball team. He recently was named the Bay Area's most powerful sports figure by the San Jose Mercury News.
Gem in the Rough
A few weeks after arranging the sale of a Sunset Boulevard condo conversion project in Pacific Palisades, Raffi Krikorian's Encino-based Investment Real Estate Associates has brokered a retail redevelopment project closer to home.
Investment Real Estate brokers Yubin Tao, Collin Plune and Warren Berzak represented Agora Realty & Management Inc. in its $5.05 million acquisition this month of the Bellingham Valley Plaza shopping center at 6418-6446 Bellingham St.
The underperforming 42,000-square-foot center, built in 1959, is in the heart of North Hollywood's redevelopment district, near the Metro Red Line and across the street from Los Angeles-based J.H. Snyder Co.'s $200 million NoHo Commons mixed-use development. Chuck LeRoy of Anchor Management Services represented the Plaza's seller, a private individual.
Agora was able to obtain the center at a below-market rate because it was 50 percent vacant and in need of extensive renovation. "Agora is a very big developer here in the valley and I think they'll be very successful with this project," Tao said. "With the Snyder project, that whole area is going to be revived."
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