SAN PEDRO, CA-The buyer of a 68-unit complex here plans to operate the property as apartments after acquiring it from a previous owner who planned to demolish the building and construct condos, according to Hendricks & Partners broker Brent Sprenkle, who arranged the sale. Sprenkle, who describes the transaction as "semi-distressed" and "challenging," says: "Most buyers were discouraged by the sheer volume of work required to rehab 50+ units. The buildings were of C quality (all small one bedrooms or efficiencies that didn't have kitchens)." Nonetheless, the property generated 21 offers, most of them from individuals or syndicators.
Beacon Harbor View LLC, a Los Angeles-based owner with a portfolio of approximately 3,000 units, bought the property from CSS Realty, also based in Los Angeles. The complex consists of 44 one-bedroom and 24 efficiency units in six detached properties fronting on 12th Street, Palos Verdes Street and Beacon Street at 123 W. 12th St., 1217 S. Beacon St. and 1222 S. Palos Verdes. The units on Beacon Street are located in a bluff overlooking the harbor.
Sprenkle tells GlobeSt.com that the loan was due and had to be paid off and, because of occupancy issues, with only 17 of the 68 units occupied, it could not be refinanced. The seller was previously planning to demolish the property to build condominiums, but when the economy turned, that was no longer an option.
The buyer paid $3.225 million, obtaining a short-term loan from Pacific Western Bank for $2.418 million.
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