The International Jewelry Center, the premier jewelry mart in downtown Los Angeles, has changed hands in the biggest downtown real estate deal to close this year.
The Moinian Group purchased the building at 550 S. Hill St. from Hertz Investment Group Inc. for $144 million in a sale that closed March 15.
Hertz Investment purchased the building in 1996 for $24.5 million when the building was 60 percent occupied, said real estate investor Judah Hertz, who heads his namesake Los Angeles company.
"Our company basically took it to this point where it is a stabilized asset," said Hertz, whose real estate investment company makes a practice of buying unstable properties where there is opportunity to make improvements. "We are very happy with the sale."
The sale of the 400,000-square-foot, 16-story building breaks down to about $360 per foot. The building, which fronts Pershing Square, is now 100 occupied with over 300 jewelry business tenants.
"It is one of the leading jewelry centers in the world," said Carl Muhlstein, executive vice president at Cushman & Wakefield Inc., who represented Hertz Investment in the transaction. "It is a gateway location to all of the Pacific Rim, South American and U.S. jewelry trade."
Muhlstein said the building is the only downtown jewelry mart built specifically for the jewelry business, so it includes amenities such as natural gas hookups to power blow torches and secure parking for customers, who often walk around with pricey purchases.
There are nearly 5,000 jewelry businesses downtown, many located on Hill and Olive streets. Other key marts include the Los Angeles Jewelry Mart and the California Jewelry Mart.
"The jewelry trade is really big," said Carol Schatz, president and chief executive of the Central City Association of Los Angeles. "This is the second largest jewelry district in the country. It is a thriving industry. This is an industry that we want to nurture and protect."
Moinian, one of New York's biggest landlords, recently started buying properties in downtown Los Angeles. Last August the company paid about $80 million for a 4.6-acre property across Figueroa Street from Staples Center and plans a large residential development there.
Cushman & Wakefield's David Hasbrouck represented Moinian in the deal. The New York-based real estate firm did not return calls seeking comment.
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