5012 Apartments in Culver City is Trion Properties' first ground-up development.

5012 Apartments in Culver City is Trion Properties' first ground-up development.

West Hollywood-based Trion Properties has completed its first foray into ground-up development.

The property is a 28-unit multifamily community at 5012 Slauson Ave. in Culver City dubbed 5012 Apartments.

The three-story building is 54% leased and celebrated its grand opening March 15.

The property has 15 one-bedroom units and 13 two-bedroom units with on-site amenities that include a breakfast bar, courtyard and covered parking.

Trion Properties usually does value-add renovations. “We had been wanting to get into the ground-up development business for a very long time. It was a natural progression of our business,” said Max Sharkansky, managing partner of Trion Properties.

The project cost roughly $8 million.

Sharkansky said Trion owns a property nearby and knew the area well, which made it a desirable location for Trion Properties’ first effort with a ground-up project.

“We’re excited that this was the first project in our development business and is a successful one, and we are looking forward to being active developers in the city of L.A.,” Sharkansky said.

He added that Trion Properties wants to do more ground-up development.

The company is working with Ketter Group on a project at 1556-1564 Hi Point St. with 45 units.

The company also recently purchased 1500-1512 Hi Point St. in Mid-City with Ketter for $7.35 million.

The property was previously entitled for a 45-unit apartment complex. Trion and Ketter are hoping to build a 58-unit development instead.

Sharkansky said the project should be ready to break ground next year.

Trion Properties was founded in 2005 as a private equity real estate firm specializing in value-add multifamily properties on the West Coast. It has completed more than $300 million in transactions and has a portfolio of more than $315 million in assets.

Its average return rate on properties is more than 30%, according to Trion, which is quick to point out that it’s not turning its back on value-add properties.

“Value-add will always be our core business,” Sharkansky said, adding that Trion was still doing value-add properties in the East Bay and Portland, Ore.

But L.A. may be a different story.

“In L.A., we haven’t been competitive in value-add because it’s gotten so expensive. I think the only thing we’ll be doing in L.A. for the immediate future (is new development),” Sharkansky said.

The company is focusing on areas without a lot of housing.

Sharkansky said the company was interested “as long as it’s an area that does not have a lot of supply, especially as we’re in this very late cycle. We probably would not buy in Hollywood or downtown L.A. or any other submarket that has a tremendous amount of supply coming online now or in the next few years.”

Trion is also interested in expanding into Denver, which Sharkansky said is also “a very competitive market.”

In the next five years or so, Sharkansky anticipates the company doing a mix of value-add and ground-up development.

“We’ll probably do our usual five to eight deals a year, or as we grow geographically, six to 10 on the value-add side and two to three on the development side,” he said.

But there could be one hitch: the coronavirus. “We have an acquisition pipeline of properties that we are writing and trying to buy, and we are writing in a more conservative fashion. We might not pay what we paid two to three weeks ago,” Sharkansky said.

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