Arts District Living Proves Successful

One Santa Fe was the first ground-up apartment complex in the Arts District.

LOS ANGELES—The Berkshire Group has acquired One Santa Fe, a 438-unit apartment complex in the Arts District of Downtown Los Angeles. The purchase price was not disclosed, however, sources unrelated to the deal tell GlobeSt.com that a joint venture between Canyon Partners, McGregor Brown and Cowley Real Estate Partners sold the property to the Berkshire Group for $200 million. Since opening, the property has seen major success, with lease-up completed ahead of schedule at rental rates that exceeded the seller’s pro forma. This sale completes the investment cycle for developers.

In addition to completing the initial investment cycle, this sale also proves the viability of multifamily in the Arts District, according to Mark Tarczynski, EVP at Colliers International and a multifamily and Downtown market expert that was not involved in this transaction. “This sale totally legitimizes the Arts District,” he tells GlobeSt.com. “Institutional capital invested in the Arts District and the project was a complete success. There was a lot of skepticism at first as to whether or not institutions would be able to do well in an area characterized by chain-link fences, razor wire and a lot of graffiti. But, institutional capital went there and was able to build a property and lease it up really fast at lease rates that are unheard of. I think, again, that this property and sale totally legitimizes the Arts District.” Berkshire Group and the joint venture did not respond to a request for comment.