Apartments Replace Market in Latest Beverly Hills Plan
Real Estate
by Danny King
Out with the shopping carts, in with the moving vans?
That could be the case for one Beverly Hills location, as J.H. Snyder Co. has proposed a predominantly residential project for its 1.75-acre site at the northwest corner of Wilshire Boulevard and Crescent Drive.
The L.A. developer, which entered into a long-term ground lease on the property three years ago, has proposed a 183,000-square-foot mixed-use project that includes 40,000 square feet of commercial use as well as 88 apartment units.
The proposal, which would cost between $40 million and $45 million to build, is Snyder’s second for the site in two years. Plans for a 153,000-square-foot office and retail project anchored by a Gelson’s supermarket were rejected by Beverly Hills in April 2001.
“So far, the reaction we’ve gotten from the city and the commission has been very positive,” said Milt Swimmer, a partner at J.H. Snyder. “We feel confident about it, but of course, you never know what will happen in the entitlement business.”
Snyder officials will next meet with the city’s planning commission on Aug. 28, and a decision could be reached as early as mid-September, according to Mahdi Aluzri, director of planning and community development for Beverly Hills. If approved, the project marks the first rental residential units to be built in Beverly Hills in more than 15 years.
Part of the project will be has high as five stories, and Aluzri said there were concerns about height and density. “But,” he added, “the planning commission has indicated that the uses are acceptable.”
Driven Out
Having vacated all but 3,000 square feet at Gardena’s Andrex Point, Hyundai Motor Co. has sold its 253,000-square-foot office building to Commercial Ventures for $28.5 million.
The automaker once took about 50,000 square feet at Andrex Point, just northwest of the San Diego (405) Freeway-Harbor (110) Freeway interchange, but moved almost all of its operations to Texas in early 2001. With 35,000 square feet, Northrop Grumman Corp. is the project’s largest tenant.
“It was excess corporate real estate,” said Grubb & Ellis Co. Senior Vice President Kevin Shannon, who, with Bill Maher and Chris Sinfield, represented both sides of the deal.
Andrex Point is the third South Bay office project that Commercial Ventures has bought in the past year and a half. The others are the Torrance Center North and Harbor Corporate Center.
A relatively healthy vacancy rate in the 190th Street Corridor was a major selling point, said Shannon. The corridor had a 14.1 percent vacancy rate for the second quarter, compared with 19.4 percent for the entire South Bay, according to Grubb & Ellis data.
“(Commercial Ventures) feels vacancies at 190th Street haven’t spiked up like other markets like El Segundo and Marina del Rey,” said Shannon. “They plan on changing the name of the project and being more aggressive in leasing the property.
Three-Year Flip
First Industrial Realty Trust is selling off its South Bay portfolio for an estimated $45 million, with four properties totaling more than a 500,000 square feet either sold or in escrow.
South Bay Business Park in Torrance and Carson Industrial Center were sold to pension fund investor RREEF and CIC LLC, respectively, for a combined $26.5 million. Hawthorne’s 105 Business Center and Torrance’s Normandie Business Center are in escrow for what South Bay sources estimate to be a combined $19 million.
FIRT, a Chicago-based real estate investment trust, bought the properties as part of a joint venture with Carlyle Group about three years ago.
“They’re fulfilling their business plan,” said Shannon, who couldn’t estimate the purchase price of the properties in 1999 because they were part of a larger pool of properties bought by the trust, but added, “they did well.”
CIC LLC, which paid $7.1 million for Carson Industrial Center, is comprised of a group of Irvine-based private investors that own a handful of industrial parks in Orange and San Diego counties. RREEF, which bought the 130,000-square-foot Carson Industrial Buildings project last October, paid $19.4 million for South Bay Business Park.
Grubb & Ellis’ Shannon, Steve Bohannon and Mike Randall, and Leonard & Ohren’s Britt Shuford represented both the buyers and sellers on the four deals.
Taking Off
Lockheed Martin Corp. sold its 20-acre Pomona property, which includes a 164,000-square-foot building, to Orton Development Inc. The Emeryville-based company plans to build 150,000 square feet of small industrial buildings at the site at 600 Bonita Ave.
Though the purchase price was not disclosed, the deal was valued at $3.2 million, according to real estate sources. Orton will spend more than $10 million developing the site, according to Tim Joyce, senior vice president of Colliers Seeley International Inc.
“They’re going to rehab and develop the balance of the site over the course of the next two years,” said Joyce, who, with Colliers Seeley’s Tom Taylor represented both sides of the deal. The buildings will be both for lease and for sale.
“That deal makes sense,” said Rick Sheckter, senior vice president at Grubb & Ellis. “There’s a lack of small buildings in that marketplace, and they do sell well.”
Start Shoveling
Pasadena-based financial services company Western Asset Management Co. signed a 10-year lease for 161,000 square feet at the Plaza Las Fuentes II development in Pasadena. With the better part of the 270,000-square-foot project, renamed Western Asset Plaza, at 385 E. Colorado Blvd. spoken for, developer Maguire Partners will begin construction on the site this week.
“The signing of the lease enabled them to break ground,” said Doug Marlow, senior vice president at CB Richard Ellis, who, with John McRoskey, represented the tenant on the deal. Marlow would not disclose financial figures of the lease, but real estate sources estimated the deal at $55 million, making it the largest of the year in the Tri-Cities.
Tony Morales and Josh Wrobel represented Maguire Partners on the Western Asset Management deal.
Staff reporter Danny King can be reached at (323) 549-5225 ext. 230, or at
[email protected].
