The 15-unit property, located at 6615 Pacific Ave., was acquired from an unnamed seller by Sierra Land Group Inc.
Compass’ Kenny Stevens and Stephanie Younger had the listing.
“What makes it unique is it’s on the sand in Playa del Rey and many, many units have ocean views,” Stevens said. “Several units have direct, front-facing sand and ocean views which is very, very rare.”
He added that the seller had owned the property for more than 30 years and decided to sell because multifamily properties “are not their main business model.”
“The owners, they are getting up there in age and decided that the time was right. The owners really focus on hospitality, and this doesn’t really fit their portfolio,” Stevens said.
He added that the property had a lot of buyer interest. And unlike some properties, which have seen their price decrease because of the Covid-19 pandemic, Stevens said the Pacific Avenue site sold for more than it was appraised at last year.
“Despite the pandemic, the property is just an asset that you find once in a generation. I’ve never seen a property like this, on the sand and a good property too, a well-maintained property of decent size and on the sand. You can’t find it anywhere,” Stevens said.
The seller, he added, had planned to accept an unsolicited offer for $10.5 million, but Stevens “persuaded them that they would be leaving money at the table if they did” and was able to sell the property for more.
Stevens said the building’s location is a positive during the coronavirus crisis.
“Because of the pandemic, people are looking for open spaces and large units,” he said. “These units are large, and you can’t get more open space than the beach in front of you.”
Renovations are on tap for the property. Stevens said the new buyer would “take it to another level,” remodeling units when they become vacant and updating the common areas.
Stevens added that another upside for the new owners is that current rents at the property are 35% below market value. Rents can be raised once tenants move out and renovations are completed.
“These owners are long-term owners, and they focus on prime, Westside of Los Angeles (properties), and they keep them forever. They invest a lot of money into the assets,” Stevens said.
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