Rendering of Newhall Ranch and Governor Jerry Brown

It’s a family affair — and some are up in arms about it.

Nonprofit organization Consumer Watchdog issued a public statement on Oct. 6, asking Gov. Jerry Brown to remove his support from the controversial Newhall Ranch project in Santa Clarita, claiming there could be a conflict of interest issue, the Los Angeles Business Journal reported.

His sister, Kathleen Brown, sits on the board of Five Point Holdings, the developer behind the project. She reportedly received nearly $122,670 in 2016 from the company, according to the statement. She is also on the board of Sempra Energy, which owns Southern California Gas and San Diego Gas & Electric. Sempra Energy owns the Aliso Canyon gas facility, responsible for what most consider the worst single natural gas leak in U.S. history.

The governor recently backed Senate Bill 634, which would consolidate several water districts and provide water for the 12,000-acre housing development. It would also abolish taxpayer’s rights to vote on the matter.

Five Point’s Newhall Ranch, slated to provide 21,500 houses and over 11 million square feet of commercial space, has faced much criticism since it was first proposed in the 1980s. Developers reached a $25 million settlement deal with environmental groups last month. [LABJ] – Natalie Hoberman

Rent in Los Angeles is expected to grow (Photo illustration)

Renters in Los Angeles will have to pay roughly $136 more a month – nearly $1,630 a year – for housing by 2019, a University of South California Casden Economics Forecast found. The increase is largely attributable to low housing availability, as well as positive wage growth and employment, according to the report.

In L.A., millennials will especially impact rent as they continue to choose multifamily apartment complexes over single-family homes. Average monthly rent in the county today clocks in at $2,237 with a 3.94 percent vacancy rate. By 2019, that number is expected to grow to $2,373 a month with 3.91 percent vacancy.

The numbers are even bleaker for out-of-state transplants.

Local renters who moved from another state pay roughly $200 more than current residents, while renters who moved from somewhere else in the state pay about $124 more.

Rising rents are also likely to negatively impact employers, who could have trouble recruiting out-of-state talent due to the high cost of living. Rent growth is outpacing income growth at an unsustainable level, concluded the study’s authors, Richard Green and Christopher Thornberg.

Photo Illustration (Getty Images/ Creative Commons)

Tom Barrack said he often confronts his longtime friend, President Donald Trump, on many of his actions.

The businessman had been instrumental in forming relationships between Trump and leaders in the Persian Gulf, but the sentiment changed when Trump publicly attacked Qatar on June 10. Trump said Qatar was a “funder of terrorism at a very high level” at a news conference, the Washington Post reported.

Colony NorthStar’s chairman reportedly said to Trump, “You don’t need to get involved,” at the time. He’s also disagreed with many of the president’s proposals, wondering why he devotes so much time to topics that don’t concern most Americans.

“He thinks he has to be loyal to his base,” Barrack told the Post. “In my opinion, he’s better than this. I tell him all the time: I don’t like the rhetoric.” He also said he’s often “shocked” and “stunned” by the president’s 140-character, provocative statements.

The two billionaires have a relationship that dates back three decades. Barrack, who publicly backed Trump’s campaign for presidency, turned down a formal role in the administration in favor of remaining a close confidant on the periphery.

The L.A. native believes Trump suffers by having too many subservient people in his orbit, afraid to contradict one of the world’s most powerful men.

“He is very good at being told he is wrong,” Barrack told the Post. “People don’t have the courage to do it. He pushes back hard, but the people he respects the most are the people who have the most refined and not wimpy point of view.”

The president, Barrack said, sometimes tells him: ““I love you, but if I listened to you, I’d still be on ‘The Apprentice.’” [WP] – Natalie Hoberman

From TRD New York: In a May interview with the New York Times, Housing and Urban Development Secretary Ben Carson warned against policies that provide “a comfortable setting that would make somebody want to say: ‘I’ll just stay here. They will take care of me.’”

Carson further said he believes in “incentivizing those who help themselves.” If that means aiding the already well-off, a comparison of two key housing subsidies by listings website Apartment List would indicate that the federal government is already doing that.

The study shows that in 2015, the government forwent $71 billion in tax revenue from the mortgage interest deduction, which allows homeowners to write down mortgage interest on their federal income taxes.That figure is more than double than the $29.9 billion spent on the Section 8 rental assistance program, which mostly benefits poor and working families.

Furthermore, wealthier homeowners are more likely to benefit from the MID than lower-income homeowners, defined as those making less than 80 percent of the area media income, the report found. The larger one’s mortgage interest, the higher the value of the deduction, so those who can itemize deductions greater than the current standard deduction of $12,600 for a married couple are most likely to benefit from MID.

And even with Section 8 taken into account for lower income families, the total expenditure between the two programs is greater for wealthier families, the report shows. The annual housing subsidy for a high-income family amounts to $1,549, according to the report, but just $222 for a middle-income family and $416 for a low-income family.

The Section 8 program, created by Congress in 1974, is a key revenue component in many of New York City’s largest affordable housing complexes, including Starrett City, which is under contract with Rockpoint Group and Brooksville Company, where the federal government subsidizes more than 3,000 apartment rents.

​President Trump’s tax plan proposes doubling the standard deduction, which would ultimately mean fewer filers claiming the MID on their annual tax returns. This has attracted the ire of the homeownership lobby, who will push congress to preserve the incentive.

Meanwhile, the White House has proposed a $6 billion cut to HUD, which manages the Section 8 program. The direct cut to Section 8 under the proposal would amount to at least $300 million, although the real drop in spending would be much more according to many analysts due to the increased demand from population growth. Other similar subsidies, such as those for the disabled and for Native Americans, would also see cuts at a time when rents paid as a share of GDP is at an all time high.

Property at Live Oak Drive, with Connie Britton (MLS/ Getty Images)

Now that her “Nashville” character has seen the axe, Connie Britton is buying homes closer to Tinseltown.

The actress dropped nearly $3.1 million for a Paul Williams-designed Mediterranean Villa on Live Oak Drive in Los Feliz, Variety reported.

Built in 1926, the 4,100-square-foot property has four bedrooms and four bathrooms. A swimming pool, lush gardens, fruit trees and patio can be found outside. Views of the Griffith Park Observatory surround the home.

The home has remained in the hands of a family trust since 1992, when it traded hands for $975,000, records show.

Roberta Collins of Keller Williams had the listing. John Galich of Rodeo Realty represented the buyer.

Britton became a household name thanks to her role as the wine-loving “Tami Taylor” on NBC’s “Friday Night Lights.” Other roles include “American Horror Story,” “Nashville,” and “Me and Earl and the Dying Girl.” The actress also owns homes in Beachwood Canyon, Texas, Tennessee and New York. [Variety] – Natalie Hoberman

New Carver Apartment Complex (Credit: Getty)

Los Angeles City Council’s Planning and Land Use Management Committee (PLUM) approved a draft of the linkage fee ordinance on Tuesday, Curbed reported. The ordinance will now head to the Housing Committee and then to City Council for final approval.

The highly-debated linkage fee would require commercial and residential developers to pay a fee of up to $15 per square foot of new development. New construction in “high market” areas, such as Venice or Hollywood, would bear the highest fees. Developers with projects in “low market” or “medium market” areas would pay under $10 per square foot.

The funds raised from the ordinance would be used for affordable housing.

Council member Mitch Englander provided the singular dissenting vote on the basis that nonprofits should be exempt from the fee. [Curbed] – Natalie Hoberman

London

From TRD New York: Lenders in North America and elsewhere are pulling back on credit they’re willing to provide for commercial properties in the U.K. as prices remain at record highs and uncertainty lingers over Brexit.

North American banks provided $861 million for commercial real estate in the six months through June, a 58 percent drop from the previous year, according to a survey of 78 lenders by De Montfort University. British banks and member-owned lenders advanced $10.8 billion for commercial properties in the first half of this year, a 14 percent fall from last year, Bloomberg reported.

“There is definitely more caution around property values,” Nicole Lux, senior research fellow at the university told Bloomberg. She said that loan-to-values “could quickly rise if prices fall.”

The demand for credit, however, has been curbed somewhat by Hong-Kong-based investors, who purchase commercial property with financing from domestic banks. Such deals were not reflected in the university’s survey. [Bloomberg] — Kathryn Brenzel 

The Wilshire Grand in Downtown Los Angeles (Credit: Wilshire Grand Center)

Ducking the laws of supply and demand, the price of renting an office space in Los Angeles rose in the third quarter as more space became available, the Los Angeles Times reported.

Rents primarily rose due to the completion of premium office buildings, such as the Wilshire Grand in Downtown Los Angeles and the Pen Factory in Santa Monica, which are demanding top dollar.

The overall average rent in the third quarter was $3.32 per square foot per month, according to CBRE. That’s up from $3.19 in the previous quarter and $3.08 in the third quarter of 2016.

Rents at the Pen Factory — a reconstructed former Papermate manufacturing plant — tally at $5 per square foot per month. Over in Downtown, the tallest tower in the West is asking $4.25 a square foot.

Santa Monica topped the list with the most expensive office rates. Landlords there are asking for more than $6 per square foot.

Nearly 1.7 million square feet of new office space entered the market this year, propelling the third quarter vacancy rate up to 14.4 percent from 13.7 in the previous quarter. The vacancy rate clocked in at 13.3 percent in the same period a year earlier. [LAT] – Natalie Hoberman

From left: Ric Clark, Owen Thomas and Lisa Picard

From TRD New York: The office market has seen plenty of innovation in recent decades, from the rise of real estate investment trusts to online databases like CoStar. But landlords have made little progress in one arena: using new technologies to appeal to tenants.

“We spend a lot of time on the analysis of our assets, a lot of time on how well they are performing and I think really little time on the end user,” Lisa Picard, who manages the Blackstone Group’s office portfolio, said at the MIPIM Proptech summit Wednesday. But now that is starting to change.

Ric Clark, Brookfield Property Partners’ real estate head, argued that the industry has been innovating for two decades. “The thing that I think is new is the customer-facing innovation,” he said. In one recent example, Clark said, a major tenant called him with a proposal. Wouldn’t it be more efficient if the landlord made common meeting rooms or hospitality space available to all tenants, which they could rent on a short-term basis? “They connected me to Convene, and next thing you know we’re an investor in Convene,” he added, referring to the meeting-room and common-space startup that raised $68 million in a Series C round earlier this year.

WeWork, which has built a business model on its appeal to tenants and invested heavily in consumer-facing technology like its member app, is another example.

“I think the real estate industry wants to innovate,” said Boston Properties CEO Owen Thomas. “The key is finding those things that really have application that’s valuable. And sometimes they don’t. I think it’s challenging.”

British Land CEO Chris Grigg pointed to Lloyd Blankfein, who proclaimed Goldman Sachs a technology company. “Goldman were smart to think about this a long time ago,” he said. Will real estate follow suit? “Some companies will go there, I’m not sure all will, I’m not sure all need to,” he said.

Added Clark: “I can’t see a real estate company ever saying ‘we’re a tech company’.”

Picard said technological innovation alone isn’t enough to really change the industry. “I think of it like the auto industry. We’re really good at adding features that apply technology,” she said. What she wants is an Elon Musk, who completely rethought transportation and forced change on established players. “That’s what we’re not good at,” she said, “rethinking the way in which we occupy space.”

Eric Gordon and his Playa Vista house (Credit: ESPN, Redfin)

NBA’s Sixth Man of the Year just earned some extra cash.

Former L.A. Clipper Eric Gordon sold his home in Brookfield Residential’s Trevion campus in Playa Vista for $2.71 million, the Los Angeles Times reported.

The three-story home has four bedrooms and five bathrooms scattered along an open plan. Amenities at the 3,500-square-foot pad include a built-in barbeque, two fireplaces and a two-car garage equipped with an EV charging station.

Gordon paid roughly $2.1 million for the home in 2014, records show. He listed the property for sale in June at $2.85 million.

Josh Goldstein of Compass represented both the buyer and seller.

The basketball player spent three seasons with the Clippers before he was traded for Chris Paul. He’s now a shooting guard for the Houston Rockets. [LAT] – Natalie Hoberman

Crenshaw Boulevard and Jack Northrop Avenue with Mayor Alex Vargas and City Council Member Angie English (Credit: Google Maps, City of Hawthorne)

In a contentious meeting filled with accusations of corruption and a heated debate, the council voted 3-2 on Tuesday in favor of Blackwood Real Estate’s hotly-contested residential project on Crenshaw Boulevard at Jack Northrop Avenue, Daily Breeze reported.

Located a half a mile from the Green Line station, the 230-unit, six-story project falls outside of the scope of several zoning restrictions, so it needed council approval to pass. The proposed project includes fewer parking than the amount required by the zoning code and its apartments are smaller than the Municipal Code permits. Its proximity to a major transit hub, reduces its vehicle footprint, the developer argued.

But SpaceX and Amazon, which both have operations next door, were against the project from day one, and its other opponents argued that the neighborhood as whole is unfit for an apartment complex, citing constant noise from industrial operations. The area is better suited for aerospace and industrial uses, councilman Nilo Michelin argued.

But despite the concerns, the council ultimately voted in favor of the development — an unprecedented move that has some council members raising their eyebrows.

Mayor Alex Vergas accused councilwoman Angie English of “entering into unilateral negotiations with the developer.” In retaliation, English accused the mayor of collusion. She was also quick to point out the conflict of interest in the Los Angeles Economic Development Corp.’s opposition to the deal. SpaceX, which is digging a test freeway tunnel underneath Crenshaw Boulevard, is a member of LAEDC. [DB] – Natalie Hoberman

When it comes to land prices, Beverly Hills might as well be paved in diamonds. Case in point: Canon Drive.

Four contiguous properties on N. Canon Drive just hit the market for a whopping $100 million, The Real Deal has learned. As a whole, the property provides 200 feet of frontage, comprised of four individual 50-foot parcels.

Gensler-designed renderings in listing materials suggest a 57,000-square-foot, mixed-use commercial structure could be built on the site, replacing the businesses that now operate there. Zoning allows for a three-story building with underground parking, according to marketing materials.

Upscale Italian restaurant Il Pastaio, Umberto hair salon, Japanese restaurant Shiki and Porto Via currently reside at 400-420 N. Canon. Contemporary eatery Porto Via expanded its restaurant in 1999 into space that includes 424 N. Canon.

Umberto Savone — hair guru and landlord — has been amassing the contiguous properties for decades, along with his wife, Babette, property records show.

Jason Oppenheim of Oppenheim Group has the listing.

Oppenheim said he expects an institutional investor or private investor to build the marketed, commercial site.

“It is one of the most unique trophy properties available in the world, and to my knowledge, the most unique development [opportunity] in the Beverly Hills triangle,” Oppenheim said.

The Savone family formerly owned the space used by the Gagosian Gallery at 456 North Camden Drive in Beverly Hills. They sold that property for $11 million in 2013. Oppenheim brokered the deal.

Photo illustration (Credit: Airbnb, Getty)

From TRD Miami: If you can’t beat them, join them?

Miami-based Newgard Development Group is partnering with Airbnb on the first Airbnb-branded apartment building in the U.S., according to Bloomberg. The move comes as the short-term rental giant tries to woo developers and property managers to allow Airbnb rentals.

The 324-unit building, which will be built just outside of Orlando in Kissimmee, will feature hotel-like amenities and encourage tenants to sublease their spaces online, Bloomberg reported. Niido Powered by Airbnb, slated to open in the first quarter of next year, will also have keyless entry and on-demand concierge services via an app. Tenants will be allowed to rent their units on Airbnb for up to 180 nights a year.

The partnership plans on bringing the concept to other cities in the Southeastern U.S., including in South Florida, according to a spokesperson.

Airbnb’s critics, who include landlords and hoteliers, say the platform increases housing costs and breaks zoning rules. By partnering with a developer, it hopes to legitimize the site among landlords and developers. “We’re trying to make sure that home-sharing is not done in the shadows,” JaJa Jackson, a director of global partnerships at Airbnb, told Bloomberg.

San Francisco-based Airbnb launched a profit-sharing agreement last year to provide property management companies a share of the hosts’ revenue.

Newgard, led by president and CEO Harvey Hernandez, has targeted users of the sharing economy before. The developer delivered the parking space-less Centro, a condo building in downtown Miami, last year. [Bloomberg] – Katherine Kallergis

432 E. Florence Avenue in South Los Angeles and Florence Metro station (Credit: Google Maps)

An unspecified developer filed plans with the city Wednesday to build a 51-unit complex at 432 E. Florence Avenue in South Los Angeles. It would be the first to use the Transit Oriented Communities incentives that went into effect last month, Urbanize reported.

Due to the project’s proximity to transit stops, the developer requested relief from yard setback requirements and an extra 11 feet in height.

Planning documents filed with the city suggest 50 units will be set aside for extremely low-income households — those earning less than 30 percent than the L.A. area median income — with the remaining unit saved for the manager of the property. An auto repair garage, which now sits on the site, would be demolished.

The incentives for developers to build near transit hubs are a recent rollout that is part of Measure JJJ, which passed with 64 percent voter support last year. The transit incentives program was officially adopted Sept. 22.

The project’s location — one block away from the Florence/San Pedro bus stop and not far from the Florence Metro — qualifies it as Tier 3 (high), meaning it is less than 750 feet away from a regular bus and Metrolink Rail station. That allows developers filing on the site to request increased density and ground area, as well as reduced parking and yard space.

Other stipulations of Measure JJJ require developers seeking zoning exemptions to pay their workers union-approved rates and set aside 40 percent of units for low-income households. [Urbanize] – Natalie Hoberman

Pacific Palisades

It’s not everyday that a home in Los Angeles comes with easy access to both horses and a butterfly retreat.

A Pacific Palisades spec home, consisting of two separate wings joined by an interior footbridge, will soon hit the market for $20 million, the Wall Street Journal reported.

Designer and developer couple Eliana and David Rokach built the 14,000-square-foot property to include ten bedrooms, nine bathrooms and two half-bathrooms. Other amenities at the home include a 20-foot swimming pool, a bocce ball court, garage parking for up to 10 cars, a tree house and a running creek.

Located in Rustic Canyon, the home sits near the Will Rogers State Park, a popular destination for horseback riding. Monarch butterflies also surround the property, thanks to the help of a landscape architect who planted a food source.

Aaron Kirman of John Aaroe Group and Santiago Arana of the Agency have the listing.

The Rokach duo previously built another home in the same neighborhood. It sold last year for $6.79 million, according to the Journal. [WSJ] – Natalie Hoberman

Rendering of Bridge Housing Corp.’s Jordan Downs project with Mayor Eric Garcetti (Credit: Bridge Housing)

Mayor Eric Garcetti requested Tuesday that six new projects be added to the Los Angeles Housing Community Investment Department (HCIDLA)’s Affordable Housing Managed Pipeline, city documents show. If approved by City Council, the projects would provide a total of 562 affordable housing units.

The projects are a result of the September 2016 Call for Projects initiative to solicit new affordable housing developments.

The recommended six projects will require $8.5 million in HCIDLA funding. Out of the 562 units, 292 will help house the homeless and another 270 will be multifamily units.

The projects the mayor approved include Abbey Road Inc.’s 100-unit Sun Commons, three separate Meta Housing Corp. projects, the next phase of Bridge Housing Corp.’s Jordan Downs project, Skid Row Housing Trust’s Flor 401 Lofts and Thomas Safran & Associates Development’s Anita May Rosenstein Center project. HCIDLA also recommended continuing the development of the Metro at Buckingham, a mixed-use Meta Housing project in Baldwin Hills/Crenshaw area.

The number of projects in the HCIDLA pipeline will rise from 16 to 23 if City Council signs off.

Clockwise from left: Developer Terra Group moves ahead on a mixed-use development in Pembroke Pines, Sting reportedly found a buyer for his pad at 15 Central Park West and Apple eyes an 85,000-square-foot office development near Culver City.

From TRD New York: Religious institutions increasingly taking vacant retail space in malls

Call it a Hail Mary play: landlords are taking a fresh look at churches to fill vacancies in struggling retail centers. The interest marks a departure for landlords, who typically considered religious institutions to be weak tenants, as they are usually not open all week and could be harder to evict since they don’t pay rent, the Wall Street Journal reported. At least 111 malls and open-air centers now have churches in them, according to an analysis of August 2017 data from the Directory of Major Malls, which tracks 8,200 retail centers in the U.S. There are three churches in the Grand Cities Mall in Grand Forks, North Dakota, and the Outlets in Loveland, Colorado leases 34,000 square feet to three churches and a synagogue. [WSJ]

Startup Easyknock wants to cash in on stricter reverse mortgage rules

A startup wants to convert homeowners — who may be having trouble qualifying for reverse mortgages under stricter federal rules — into renters. Easyknock, an online platform that connects home sellers to buyers, is launching a product next week called Sell and Stay. Homeowners who want to unlock the equity in their homes but don’t qualify for a reverse mortgage can sell their property online, with a stipulation that lets them stay on as renters for a set period of time. Tighter federal rules limiting how much cash borrowers can take out through reverse mortgages took effect on Oct. 2. Sell and Stay is launching in New York City, Long Island, several cities in California, Atlanta, Indianapolis, Orlando and Houston. The company raised $1.2 million in a seed funding round led by Cambridge Innovation Capital last month. [TRD]

U.S. spends more than double on homeowner subsidies than on Section 8: report

Who do housing subsidies benefit more in the U.S., wealthy homeowners or poor and working families? If you guessed poor and working families, you’d be wrong. A comparison of two key housing subsidies by listings website Apartment List found that in 2015, the government waived $71 billion in tax revenue from the mortgage interest deduction, which allows homeowners to write down mortgage interest on their federal income taxes. That figure is more than double than the $29.9 billion spent on the Section 8 rental assistance program, which mostly benefits poor and working families. Wealthier homeowners are more likely to benefit from the MID than lower-income homeowners because the larger one’s mortgage interest is, the higher the value of the deduction. [TRD]

MAJOR MARKET HIGHLIGHTS

Rebuilding homes damaged in California wildfires could cost $65B: report

Wildfires are devastating Napa Valley and Santa Rosa and the cost of completely rebuilding homes there will be daunting. Nearly 172,000 homes in Napa Valley and Santa Rosa are in the line of fire in Northern California, with roughly 11,000 facing significant damage, according to a CoreLogic study reported by the Wall Street Journal. Rebuilding the homes from scratch would cost a whopping $65 billion, according to CoreLogic. Average homes in the Napa and Santa Rosa metro cost about $599,000 — far greater than the country’s average of $201,900 — according to Zillow. The fires spreading through Northern California have already claimed the lives of at least 15 individuals and destroyed much of the wine region. [WSJ]

Apple eyeing Hackman’s La Cienega Expo project in LA: sources

Apple may be moving its original-content division to West Los Angeles, The Real Deal has learned. The company is in talks to lease all of Hackman Capital Partners’ 85,000-square-foot office development at 5500 W. Jefferson Boulevard near Culver City, sources said. The property sits near the La Cienga Expo Line Station. The website for the property lists triple net rent of $3.75 a square foot per month, which would value the lease at $3.83 million a year. A tenant can move into the completed development in January 2018, according to Loopnet. If completed, the lease could be Apple’s second with Hackman. Apple is aggressively moving into the original content space and recently announced it would set aside $1 billion for production. [TRD]

Terra closes on South Florida land, gets construction loan for mixed-use development

South Florida developer Terra Group is moving ahead on its mixed-use development in Pembroke Pines. The firm scored $48.8 million in financing to begin construction on the project called 16000 Pines Market. The lender was Pineland Finance and Investment. Terra also purchased a portion of the development site at 16000 Pines Boulevard for $11.5 million from the city of Pembroke Pines. In 2015, the city had purchased the 27-acre property from the U.S. Postal Service for $17.8 million. The site is currently occupied by a post office and a postal distribution center, but last year, Terra won approval to build 135,000 square feet of retail and 20,000 square feet of restaurant space on the land. [TRD]

Two Chicago developers plan record-tall skyscrapers

Two developers are seeking to approval for new towers that would be among the tallest in the city. JDL Development is looking to spend $700 million to develop two luxury residential towers west of the Loop, including one that would become the city’s sixth-tallest skyscraper. Meanwhile, Related Midwest is planning to build the two tallest towers in the Fulton Market district — a 58-story residential and hotel tower and a 51-story residential tower — according to the Chicago Tribune. Zoning plans have been submitted for the projects. JDL Development is looking to build residential towers with 76 and 45 stories connected to a nine-story retail base. If built as proposed, the taller tower, One Chicago Square, would be 1,011 feet. [Chicago Tribune]

Sutton, SL Green tap German lender again for $225M refinance at NYC’s 650 Fifth

SL Green Realty and Jeff Sutton once again turned to German lender Aareal Bank with the recent refinance deal for their retail space at 650 Fifth Avenue, obtaining a $225 million leasehold mortgage. The debt deal comes 10 months after Nike agreed to a 60,000-square-foot lease at 650 Fifth, with an annual rent starting at $35 million — one of the most expensive retail leases in the city’s history. The new loan agreement replaces a previous $97 million mortgage, also from Aareal, from October 2014, and includes a $128 million gap mortgage. In January of this year, Aareal refinanced SL Green and Sutton’s 724 Fifth Avenue, home to Prada’s flagship store, with a $235 million loan. [TRD]

L&L Holding and pension fund plan $4B spending spree

One can expect to see some properties change hands in New York City soon, courtesy of a new joint venture that’s getting ready to do some major shopping. L&L Holding Company is teaming up with a large domestic pension fund to go on a $4 billion spending spree in New York City.“The objective here is for us to have an identified capital source up front in order to move even more quickly on off-market and even marketed deals,” L&L president Robert Lapidus told The Real Deal. “We thought this is a really good time to have dry powder and think there will be certain situations where there will be less competition [for deals].” JPMorgan is advising the pension fund, which Lapidus declined to name. [TRD]

Sting reportedly sells home at 15 Central Park West for $50M

Sting’s lyrics about walking in fields of gold seem prophetic now that he and his wife Trudie Styler’s duplex at 15 Central Park is reportedly under contract, after being listed in May for $56 million. The buyer has agreed to pay $50 million for the 5,500-square-foot home in the Zeckendorf Development building, the New York Post reported. The apartment is on the 16th and 17th floors of the Robert A.M. Stern-designed building, and has three bedrooms and five-and-a-half bathrooms, according to StreetEasy, which has not recorded the apartment as in contract. The couple is reportedly buying a triplex at 220 Central Park South. The award-winning singer paid $27 million for the 15 Central Park West apartment in 2008, according to the Post. [NYP]

The former home of film innovator Carroll Dunning, on Hillcrest Road in the Hollywood Hills, is seeking $5 million, the Los Angeles Times reported.

Built in 1929 by renowned L.A. architect Paul Revere Williams, the home has five bedrooms and five bathrooms across 5,000 square feet of living space. The property features arched windows, a tiled fireplace, terraced patios and a saltwater swimming pool. Views of the Hollywood Hills surround the triangular corner lot.

The home last traded for $1.7 million in 2014, records show.

Travis Canby and Judith Lovingfoss of Keller Williams Realty have the listing.

Dunning, the co-founder of Dunningcolor Corp., is best known for creating the “green screen” processing technique, known as the “Dunning Process.” The process was first used in the 1933 blockbuster “King Kong.” [LAT] – Natalie Hoberman

Rendering of The Lake on Wilshire (Credit: thelakeonwilshire.com)

The Los Angeles Planning Commission has thrown its support behind a major development in Westlake, dubbed “The Lake on Wilshire,” Curbed reported. If approved by City Council, the project will provide a 220-key hotel, a multi-cultural center and a 41-story apartment tower at the intersection of Wilshire Boulevard and Bonnie Brae Street.

The owner and developer, Dr. Walter Jayasinghe, who is also a surgeon, plans on dedicating 39 of the 478 apartments to very low-income households. In exchange, he hopes the city allows him greater density than zoning permits.

But the commission and neighborhood residents claim the income limits (a family of three can earn up to $40,550 and still qualify) are too high and the number of dedicated units too low. As part of the vote of approval, the commission recommended the developer increase the number of affordable units to 49.

Jayasinghe plans on converting a 14-story office building on the site, which stands steps away from Metro’s Westlake/MacArthur Park station. The transit-oriented location, along with Jayasinghe’s plans to bring ground-floor restaurants and a public plaza, stood out to commissioners and city planners who wish to revitalize the neighborhood in between Downtown Los Angeles and Koreatown.

Just a bit to the east, local developer 4Site Real Estate is planning a 54-unit apartment complex at 1246 W. Court Street. West Coast developer CityView is also planning a 243-unit mixed-use complex nearby at 1800 Beverly Boulevard. [Curbed] – Natalie Hoberman

Old (top) and new (bottom) renderings of The Fig (Credit: Visionscape Imagery, WATG)

Sometimes bigger is not always better, especially in a town where “bigger” tends to mean “more neighborhood opposition.”

Irvine-based developer Spectrum Group may be taking a cue from the city’s many developer v. neighborhood battles. It officially discarded its proposed high-rise tower from its massive mixed-use development proposal, called “The Fig.” The project in Exposition Park would sit across the street from Banc of California Stadium and near the University of Southern California’s campus, Urbanize reported.

Renderings, designed by WATG and Architects Orange, hint that the high-rise would be replaced with several seven-story structures stretching across the property at 3900 Figueroa Street.

The proposed development would now consist of three separate buildings featuring a 298-key hotel, 222 units of student housing and 186 apartments, according to a recent environmental impact report.
Approximately 82 of the 186 apartments would be set aside for residents earning 80 percent of the area median income, or less.

Other features of the Fig would include ground-level retail, creative office space, a seven-story parking structure with a rooftop amenity, restaurants and public meeting spaces.

Construction is expected to occur over 18 months, subject to approval from the city.

The Fig is just one of the housing projects aimed at serving USC students. Most recently, the University opened USC Village at the corner of Hoover and Jefferson streets, a $700-million, 1.2 million-square-foot complex with housing for up to 2,500 students. [Urbanize] – Natalie Hoberman