LOS ANGELES—If the first two weeks of the year are any indication, 2017 is going to be a great year. Already we have reported several major sales: CoreTrust's $336 million acquisition of the CitiGroup Center in Downtown Los Angeles; Redwood Urban and Beverly Pacific's $132 million purchase of the Jefferson in Hollywood; and now Broadreach Capital Partners' sale of the Sunset in West Hollywood. The investor has sold the 179,000-square-foot mixed-use development for $210 million, adding to a pile of headline-worthy sales to stack up in the first few weeks of the year.
The three transactions, aside from scale, have little income. They are in different asset classes and in different geographic locations in the city. However, they do represent the fervent interest investors have in Los Angeles real estate, and much of that has to do with job growth. Beacon Economics, in fact, published a report at the end of 2016 that said job growth in Los Angeles was keeping L.A. from overheating. The report came with a bright outlook for the city in the year ahead.
If you talk to the investors working on these deals, that could be true. Curtis Palmer, executive managing director at ARA Newmark and the broker on the Jefferson deal in Hollywood, tells GlobeSt.com in an interview about the transaction, “There are only more jobs that are coming. Kilroy is building behind the Arc Light, at the Academy of Arts and Sciences site. They are going to bring another 300,000 square feet of office space to the market for a similar type of tenant. [In Hollywood], it could not be better news for multifamily.”
His team has been active in the Hollywood market recently, and he says that there have been a significant amount of land-sale deals. “We have been really active in the Hollywood market, and we have closed several land deals in the market, adds Palmer. “Unlike Downtown, where there is a lot of concern about overbuilding, that isn't the case in Hollywood because you are getting all of these jobs. That has been missing from Downtown.”
John Sischo, a principal at CoreTrust, was also looking at the job growth in Downtown Los Angeles, and more specifically migration to the submarket from suburban markets, as an opportunity on his deal, a 914,000-square-foot office campus. “What we are finding is that companies, especially suburban companies, are starting to have difficulty finding employees because they don't want to live in the suburbs,” he tells GlobeSt.com in an interview about the transaction.
We are basically building the company up again with the same kind of assets, focused on the CBD-oriented and large assets, and the same business plan.
The Sunset has a 72,000-square-foot office tower and a 107,000-square-foot retail plaza. The property also includes parking and other cash-flowing amenities, like three billboards. HFF senior managing directors Ryan Gallagher and Michael Leggett, who is also co-head of HFF's West Coast team, and managing directors Bryan Ley and Andrew Harper and director Tim Geiman represented the seller in the transaction. More information to come on the deal.
LOS ANGELES—If the first two weeks of the year are any indication, 2017 is going to be a great year. Already we have reported several major sales: CoreTrust's $336 million acquisition of the
The three transactions, aside from scale, have little income. They are in different asset classes and in different geographic locations in the city. However, they do represent the fervent interest investors have in Los Angeles real estate, and much of that has to do with job growth. Beacon Economics, in fact, published a report at the end of 2016 that said job growth in Los Angeles was keeping L.A. from overheating. The report came with a bright outlook for the city in the year ahead.
If you talk to the investors working on these deals, that could be true. Curtis Palmer, executive managing director at ARA Newmark and the broker on the Jefferson deal in Hollywood, tells GlobeSt.com in an interview about the transaction, “There are only more jobs that are coming. Kilroy is building behind the Arc Light, at the Academy of Arts and Sciences site. They are going to bring another 300,000 square feet of office space to the market for a similar type of tenant. [In Hollywood], it could not be better news for multifamily.”
His team has been active in the Hollywood market recently, and he says that there have been a significant amount of land-sale deals. “We have been really active in the Hollywood market, and we have closed several land deals in the market, adds Palmer. “Unlike Downtown, where there is a lot of concern about overbuilding, that isn't the case in Hollywood because you are getting all of these jobs. That has been missing from Downtown.”
John Sischo, a principal at CoreTrust, was also looking at the job growth in Downtown Los Angeles, and more specifically migration to the submarket from suburban markets, as an opportunity on his deal, a 914,000-square-foot office campus. “What we are finding is that companies, especially suburban companies, are starting to have difficulty finding employees because they don't want to live in the suburbs,” he tells GlobeSt.com in an interview about the transaction.
We are basically building the company up again with the same kind of assets, focused on the CBD-oriented and large assets, and the same business plan.
The Sunset has a 72,000-square-foot office tower and a 107,000-square-foot retail plaza. The property also includes parking and other cash-flowing amenities, like three billboards. HFF senior managing directors Ryan Gallagher and Michael Leggett, who is also co-head of HFF's West Coast team, and managing directors Bryan Ley and Andrew Harper and director Tim Geiman represented the seller in the transaction. More information to come on the deal.
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