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[IMGCAP(1)]NORTH HOLLYWOOD, CA-Developer J.H. Snyder of Los Angeles has started the $79.4-million third phase of the company’s $375-million NoHo Commons project, and another L.A. developer is converting apartments to office condos in the NoHo district as the developer and investor interest in North Hollywood continues unabated. The third and final phase of Snyder’s project features an 182,000-sf class A office building with 10,000 sf of retail and restaurant space; a 30,000-sf, seven-screen Laemmle Theater; a 700-space parking garage and a family diner–all within one block of North Hollywood MTA Station.

[IMGCAP(2)]At the same time Snyder is getting under way with its project, North Hollywood-based developer DT Group is converting the NoHo Lofts at 5355 Cartwright Ave. in the NoHo Arts District into 68 office condos. Dan Markel, president of DT Group, explains that the project, which was built in 2006, “is not only ideally designed to function as a live/work project but, equally important, in this chaotic financial climate, it provides an ideal economic solution for start-up or small businesses.”

Snyder Co. and Laemmle Theatres broke ground Monday on their project, which will be situated on nearly three acres at the corner of Lankershim and Weddington. This latest component of North Hollywood’s revitalization is part of a joint deal between the J.H. Snyder Co. and the Community Redevelopment Agency of the City of Los Angeles to construct a transit-oriented development near the North Hollywood station. The project site is part of the 743-acre, North Hollywood Redevelopment District

This latest phase will restore a historic San Fernando Valley diner, notes Jerry Snyder, senior partner at J.H. Snyder Co. The 1920s era Phil’s Diner, designed in a railroad car style by Charles Amend and with a distinctive neon sign overhead, previously served generations in the San Fernando Valley from a spot on Chandler Boulevard. The diner will be relocated within the project and the diner’s missing, original sign will be recreated.

As part of the financing agreement, the CRA/LA will provide the site to J.H. Snyder for one dollar, and then refund J.H. Snyder Co. $3 million in land acquisition payments. The CRA/LA will also pay the company $4.2 million for providing public and theater parking for 45 years.

The NoHo Commons project was approved in 2001. Phase one, completed in December 2006, includes a 438-unit mixed-income residential rental project. Phase two, completed June 2007, features 292 units of loft and live/work rentals and 60,000 sf of retail/commercial space including the HOWS supermarket, a bank, mobile phone store and several restaurants.

The DT Group’s office condominium conversion project is designed to provide a number of benefits that the developer believes will make it more marketable in today’s financial climate. Markel points out that if more than one-third of a unit is allocated to residential use, “there are highly attractive tax benefits.” He also notes that the building, which originally served as the Adolph’s Meat Tenderizer testing facility, “has the structural bones which make it ideal for commercial office use.”

According to Chris Baer, a principal at Ramsey-Shilling who is a former CPA and tax consultant, financing at NoHo Lofts is arranged by the developer, thereby saving the buyer time and eliminating the travail of dealing with lenders during this credit-crunch period. “There’s also another intriguing investment aspect provided by the project–buying one of the units and renting it to another party,” said Baer. “Besides cash flow, capital appreciation and tax benefits, there are 1031 property exchange possibilities.”

The DT Group’s project features units ranging from 520 sf to 1650 sf at prices from $243,000 to $890,000. The project also features business centers, fitness facilities and roof-top amenities for group entertaining.

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