LOS ANGELES-A joint venture of Kennedy Wilson and RECP/Urban Partners has acquired 167 condo units and 18,694 square feet of retail space at the Santee Village development in Downtown L.A. in an REO sale by Bank of America. Robert Hart, president and CEO of Kennedy Wilson Multifamily Management Group, calls the project “one of the last opportunities in the current real estate cycle to acquire a condo property in the downtown L.A. area.”
Hart points out that more than $15 billion has been invested in Downtown Los Angeles in the past dozen years, and while the area has always been the employment, transportation and cultural arts hub of the region, it has now developed into a tourist destination with approximately 14.6 million visitors each year. “Downtown’s residential population has blossomed to 42,000 and its daytime population is over 500,000,” Hart notes.
Santee Village is composed of three buildings located at the northern end of the fashion and garment district and are designated as local historic monuments. Originally built by business tycoon Michael J. Connell in the 1910s, the buildings were purchased in 1998 and underwent a nearly 10 year process of restoration and adaptation to residential loft living. The residences feature concrete floors, oversized industrial windows and 10-foot to 14-foot vaulted ceilings. The buildings share a central courtyard with the neighboring Santee Court apartments.
Financial terms of the Kennedy Wilson/RECP purchase were undisclosed. According to GlobeSt.com reports in 2006, developers MJW Investments and Phoenix Realty Group described the combined Santee Village and Santee Court as seven former garment district buildings representing a $130-million development. In total, the seven former apparel industry buildings have been converted into 445 rental and for-sale units and more than 61,000 square feet of retail space, according to the previous GlobeSt.com reports.
The acquisition marks the third partnership between Kennedy Wilson and RECP/Urban Partners. Debt financing was provided by Deutsche Bank, and Mark Tarczynski and Adam Tischer of CB Richard Ellis represented the buyer and the seller in the transaction.
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