Tower Owner Hopes to Rise After Chapter 11

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The partnership that owns Figueroa Tower in downtown Los Angeles has filed for Chapter 11 protection while it reorganizes its finances.

The building is one of many properties held by Milbank Real Estate Services Inc. through separate limited liability companies. Milbank has been trying to sell Figueroa Tower for more than a year. The real estate investment and management company bought the 24-story building at 660 S. Figueroa St. for $62.4 million in 2004 from the Mani Bros. Real Estate Group. Milbank filed last month to reorganize the partnership that holds the building, Figueroa Tower-I LP. Liabilities are estimated at $64.3 million, most of it in the mortgage.

The tower joins four other Milbank properties in Chapter 11. The company has also sold several properties.

Many of its problem holdings were purchased at the height of the market. In 2009, Milbank filed Chapter 11 to reorganize the company that owns its downtown Roosevelt Lofts. It also has filed Chapter 11 to reorganize the companies that own Encino Corporate Plaza at 16661 Ventura Blvd., and First National Buildings I and II in Oklahoma City.

A year after Milbank bought the Figueroa Tower, its anchor tenant, law firm Manning & Marder Kass Ellrod Ramirez LLP, broke its 60,000-square-foot lease early and moved across the street to 801 S. Figueroa, which is owned by Mani Bros. While the space was subleased, the uncertainty of lease renewals made it nearly impossible for Milbank to find a buyer for the building, which was already 25 percent vacant, much higher than the 15 percent market average. Milbank listed Figueroa Tower for $75 million in August last year.

In a motion related to the Chapter 11 filing, the company asks to use cash collateral from the Figueroa Tower’s August and September rent, a projected total of $968,000, to pay the building’s operating costs and related bankruptcy charges until it completes reorganization.

Among the top unsecured creditors listed in the filing are the Los Angeles Department of Water and Power, AMB Security Services, Colliers International and Cushman & Wakefield.

Milbank did not return calls for comment.

AV Club

CCS California, an audio and visual equipment company, is consolidating its L.A. base and Orange County office at a new headquarters in Hawthorne this month.

The company bought a 12,250-square-foot property, at 3331 Jack Northrop Ave. near the Hawthorne Airport, for $2.1 million from Kearny Real Estate Co. in June. It’s investing $1 million to convert 80 percent of the industrial warehouse into corporate office space, and to create a showroom and servicing facility.

The firm is moving from a 7,000-square-foot office at 5055 Wilshire Blvd. and a 1,500-square-foot Costa Mesa office at 3525 Hyland Ave.

The new digs are in the Century Business Center, an 86-acre business park, formerly home to defense contractor Northrop Grumman Corp., near the intersection of the San Diego (405) and Century (105) freeways. The complex is also home to electric-car maker Tesla Motors and Space Exploration Technologies Corp., better known as SpaceX.

The 15-year-old company sells products such as interactive whiteboards, projectors and video conference systems to clients that include Northrop, UCLA and Walt Disney Co.

CCS was represented by Travers Realty’s Guy Eisner and Mark Rauch. Kearny was represented in-house by Principal Hoonie Kang.

Lion Roars

Lion Real Estate Group is on a buying spree. It recently picked up one multifamily complex and is in escrow on another and a mixed-use property. The value of the three transactions is $8.5 million.

Last month, the Brentwood property investment company bought for $2.6 million a 24-unit Silver Lake apartment complex, at 1042 Sanborn Ave., just steps from the area’s popular retail strip Sunset Junction.

It also paid $2.6 million for a 42-unit building in Hollywood, at 5105-5115 Melrose Ave. at the corner of St. Andrews Place near Paramount Studios.

Lion is buying a mixed-use property that includes a 34-unit Pasadena complex. The sale is scheduled to close at the end of this month. The four-story building, at 306 S. El Molino Ave., is next to a triplex and a parking lot, which are included in the $3.3 million deal.

The company, which specializes in buying and revitalizing underutilized properties, plans to renovate all of its recent purchases and achieve higher rent rates within the year.

The company has bought eight other properties in the past year, and plans to acquire 1,000 residential units within the next five years.

Staff reporter Jacquelyn Ryan can be reached at [email protected] or (323) 549-5225, ext. 228.

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