Thomas Properties Group Inc. has sold a large El Segundo site on which it had planned to build a nearly 2 million-square-foot mixed-use complex for $48.1 million.
El Segundo developer Continental Development Corp. and Torrance real estate firm Mar Ventures Inc. bought the 24-acre Campus El Segundo property at North Nash Street and East Mariposa Avenue from Thomas, which had been marketing the site for 11 months. The sale includes a 12,000-square-foot, two-story marketing office next to the property at 800 Parkview Drive North as well as naming rights for an adjacent soccer complex.
Mar Ventures bills itself as an integrated real estate firm specializing in the acquisition, master-planning and redevelopment of underutilized properties. It built a 200,000-square-foot office-retail complex next to the recently purchased site.
Continental Development has developed and manages 4 million square feet of commercial real estate, including office, retail and entertainment properties. Its signature development is the 3 million-square-foot mixed-use complex on Rosecrans Avenue in El Segundo known as Continental Park, where CBRE Group Inc., JustFab and CBS Digital Media have offices.
The Campus El Segundo property comes with entitlements for up to 1.7 million square feet in eight low- and midrise mixed-use buildings.
Robert E. Tarnofsky, director of real estate at Continental Development, said the company plans to use some of the existing entitlements at the site, though its exact plans have not yet been ironed out.
“The development they entitled contemplated a series of midrise office structures with related structured parking and we are probably going to take a fresh look at development opportunities and plans for that site,” he said.
Thomas sold the property as part of a larger move to reduce the amount of land entitled for development in its portfolio as it moves toward becoming a real estate investment trust.
With the proceeds, it is repaying a $14.5 million mortgage loan on the property to Wells Fargo Bank and expects to net $33.2 million from the sale, Paul Rutter, its co-chief operating officer, said in a May 7 earnings call.
Thomas sold a 2.15-acre portion of the site, entitled for a 143-room hotel, to OTO Development LLC for $4.4 million in October.
Mortgage Declines
Home mortgage delinquency in the greater Los Angeles County area continued to drop in the first quarter this year, according to a recent report from TransUnion LLC.
The number of borrowers 60 days or more late on their home mortgage payments fell more than 2 points from the year-ago period to just 4.2 percent in the first quarter. That’s the lowest it’s been since the first quarter of 2008, when the delinquency rate was 3.6 percent. It peaked in the fourth quarter of 2009 at 10.6 percent.
Total mortgage debt outstanding also declined, falling 2.6 percent from the year earlier to an average of $350,089 in the first quarter. The average size of a mortgage statewide peaked in first quarter 2009 at $389,271.
The L.A. numbers are in line with rest of the state’s, which had the second largest year-over-year delinquency rate decline in the country in the first quarter. The statewide rate fell nearly 2.5 points to 4.2 percent. California also experienced the third largest year-over-year decline in total mortgage debt nationwide, dropping more than 3 percent to $320,419.
Tim Martin, group vice president of U.S. housing in TransUnion’s financial services business unit, said the accelerated rate of improvement was unexpected.
“The housing sector as a whole has definitely been improving with prices up, negative equity down and rates staying low,” Martin said in a statement. “That seems to have helped borrowers this quarter, some of whom have been delinquent for a rather long time, work their way out of the system at a faster pace.”
Lowe Goes South
Brentwood developer Lowe Enterprises Inc. was selected to build a $90 million mixed-use development for the San Diego Community College District.
Lowe, with San Diego development partner I.D.E.A. Partners, received a long-term ground lease and rights to develop up to 400,000 square feet on a full city block, bounded by E, F, Park and 13th streets in downtown San Diego after a competitive bid process. The project will be designed by downtown L.A. architecture firm Gensler’s San Diego office.
The 1.4-acre site will be developed to include creative office space, apartments geared toward young professionals, and ground-floor restaurants and shops. It will also include indoor and outdoor courtyards connecting the commercial and residential buildings. The courtyards might also be used for events.
The team has begun finalizing design and development plans. It expects to begin construction next year and be completed by 2016.
Staff reporter Jacquelyn Ryan can be reached at [email protected] or (323) 549-5225, ext. 228.
