Kidder Mathews of California, the West Coast arm of the brokerage firm Kidder Mathews, is suing Oak Valley Development for breach of contract over commission fees tied to an industrial project.

According to the complaint filed with L.A. Superior Court in January and reviewed by TRD, Oak Valley Development hired Kidder Mathews in May 2019 to sell the Oak Valley Town Center Property in Calimesa, California, which was originally sized as a 55-acre site. 

The site included six lots that Oak Valley Development was looking to sell as “either raw land for development or in a state prepared for development,” according to the lawsuit.

In March 2020, Oak Valley Development sold 114 acres of the Oak Valley Town Center Property at $13 per square foot to Newport Beach-based real estate company Birtcher Development, Kidder Mathews alleges.

The brokerage firm says it helped secure the buyer for the larger property and then wasn’t paid the remainder of the fees, or another $1.3 million, according to the suit.

“OVD [Oak Valley Development] paid Kidder Mathews $1.3 million, amounting to 4 percent of 57.15 acres of land,” the brokerage firm alleges in the lawsuit. “OVD has wrongfully and in bad faith refused to pay Kidder Mathews the remaining sums due to it for the sale of the Oak Valley Town Center Property, i.e., 4 percent of the remaining 56.896 acres sold to Birtcher by OVD.”

Birtcher got approval to build Birtcher Oak Valley Commerce Center in 2022, with construction of the warehouse campus slated to be completed in the fourth quarter of 2024.

“Limited supply and strong tenant demand continue to drive unprecedented pre-leasing activity for new construction in the Inland Empire,” Brooke Birtcher Gustafson, a firm executive, said at the time.

Birtcher’s construction plan consisted of two phases, totalling 2.2 million square feet on about 50 acres, according to a company statement issued in July 2021.

Birtcher Oak Valley Commerce Center will include four Class-A industrial buildings, offering 40-foot clear heights and a minimum of 185-foot truck courts. 

“Located at Singleton Road and Roberts Road in Calimesa, the site provides an opportunity to meet autonomous trucking needs with immediate freeway access onto its campus,” the company noted in a statement.

Kidder Mathews and Birtcher Development did not reply to a request for comment. Oak Valley Development could not be reached for comment.

The post Kidder Mathews sues Oak Valley Development over commissions appeared first on The Real Deal.

Cities won’t see any new developments from Kilroy come online this year. 

“We do not anticipate starting any new developments in 2024,” Justin Smart, Kilroy’s president, said on a conference call Tuesday discussing the real estate investment trust’s fourth-quarter earnings. 

Instead, the L.A.-based firm is focused on its 17 million-square-foot office and life science portfolio, which saw occupancy dip over the course of 2023. 

Kilroy’s properties were 85 percent occupied at the end of last year. By comparison, at the end of 2022, Kilroy’s portfolio was about 92 percent occupied. 

Revenues dipped alongside occupancy. 

The company’s revenues totaled $269 million in the fourth quarter, down from $284 million during the same period in 2022, according to an earnings release on Monday. 

Kilroy reeled in about $185 million in net operating income in the last three months of 2023, a 7.5 percent drop from the fourth quarter of 2022. The Los Angeles-based REIT reported $1.08 per share in funds from operations in the fourth quarter, compared to $1.17 a share a year prior. 

“The REIT’s occupancy rate declined materially in 2023 and will decline further in 2024 as leasing activity remains modest in most of its markets,” Moody’s wrote in a report on Kilroy last month. 

On the Tuesday call, CEO Angela Aman said leasing activity was strong, adding the firm signed 590,000 square feet worth of leases  — “the highest quarterly leasing volume since 2019,” she noted. 

While Moody’s kept its credit ratings on Kilroy steady last month, citing “excellent portfolio quality,” the ratings agency tagged the company with a negative outlook. 

Moody’s expressed concern about Kilroy’s net debt to EBITDA ratio of 6.5 — a metric measuring how much cash from operations is available to pay off company debt. The lower the ratio, the more likely a company can pay off its debt successfully.

There’s “persistent weakness in the operating environment for office space,” Moody’s said in its report, which will “reduce the REIT’s ability to improve occupancy and grow earnings.” 

About $22 million of the firm’s expenses in the fourth quarter — roughly 11 percent of the total  — was dedicated to the retirement of the company’s now former CEO John Kilroy. 

Kilroy retired last month and was succeeded by Aman, who previously ran Brixmor Property Trust. 

The post Kilroy Realty won’t start any new developments in 2024 appeared first on The Real Deal.

UCI Health has paid nearly $1 billion to buy four hospitals in Orange County.

The clinical arm of the University of California, Irvine paid $975 million in cash for the four medical centers in Fountain Valley, Lakewood, Los Alamitos and Placentia, the Commercial Observer reported. The seller was Tenet Healthcare, based in Dallas.

The Regents of the University of California, on behalf of UCI, entered into the definitive agreement to buy Tenet’s Pacific Coast Network.

The purchase includes the 400-bed Fountain Valley Regional Hospital, 172-bed Lakewood Regional Medical Center, 167-bed Los Alamitos Medical Center and 114-bed Placentia-Linda Hospital and associated outpatient clinics.

The sale is expected to close this spring, subject to regulatory approvals, clearances and closing conditions.

The hospitals together generated $1 billion in revenue last year, along with $71 million in adjusted earnings before interest, tax, depreciation and amortization, according to Tenet. The sale of the hospitals to UC Irvine is part of the firm’s strategy to cut debt.

The move comes months after Tenet sold three South Carolina hospitals and related operations to Novant Health for $2.4 billion. 

Despite the divestments, Tenet remains among the largest health care providers in the country. 

Its network includes United Surgical Partners International, which owns or operates more than 480 ambulatory surgical centers across the U.S., plus 160 outpatient facilities and 58 specialty and acute care hospitals.

UCI Health operates the 459-bed UCI Medical Center in Orange, which includes a cancer center, regional burn center, and the area’s only Level 1 trauma center, plus a growing network of multispecialty care centers.

UC Irvine expects to open a $1.3 billion medical complex and 144-bed hospital next year in Irvine, where hospitals and healthcare providers from across the region are racing to expand or to set up shop.

— Dana Bartholomew

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Douglas Emmett, a publicly listed real estate investment trust that owns office and apartment buildings in Southern California and Hawaii, took out a $550 million loan package backed by a portfolio of four residential properties, according to the company’s fourth-quarter filing with the SEC.

Notably, one of the four buildings is the embattled Barrington Plaza, one of the biggest multifamily complexes in West Los Angeles that has been the center of a tenant lawsuit against Douglas Emmett over mass evictions. 

Last year, Douglas Emmett evicted tenants from the 60-year-old tower, located at 11740 Wilshire Boulevard in Satelle, which impacted more than 700 affordable units and took all units off the market. The company cited the need to install $300 million fire sprinkling systems. 

The floating-rate loan will mature in 2027, according to the filing, and has an interest rate equal to the secured overnight financing rate plus 1.48 percent. As of Feb. 5, SOFR was at 5.31 percent. Douglas Emmett did not disclose the lender, and did not disclose which other buildings the loan backs. 

“For the portion [of the loan] secured by Barrington Plaza, in connection with the removal of that property from the rental market, we deposited $13.3 million of cash into an interest-bearing collateral account with the lender,” according to the filing. 

“The lender is treating the loan as a construction loan and we signed a construction completion guarantee,” Douglas Emmett added. 

The filing noted that the lender will return the deposit in August 2026 or when the loan is paid in full, whichever comes earlier. 

The loan commitment comes at a time when the fate of the building’s tenants is still uncertain, with some pledging to fight the eviction notice last year and others — particularly residents over 62 or disabled — having up to one year to leave, as TRD reported earlier.  

The post Douglas Emmett scores $550M construction loan partly tied to Barrington Plaza appeared first on The Real Deal.

True Life Companies has beat back a legal challenge to a housing project in El Sereno, giving it the go-ahead to build 42 homes, and the court victory could limit future environmental challenges to development.

An affiliate of the Denver-based developer triumphed when a state appellate court dismissed an environmental lawsuit by an unidentified open space-advocacy group trying to block the project at North Eastern Avenue and Lombardy Boulevard, the Los Angeles Business Journal reported.

The unidentified appellate panel reversed a lower court decision against the project, saying the lawsuit was filed beyond the statute of limitations.

The court decision, while not preventing future legal challenges, sets a precedent limiting the timeframe for such challenges during a project’s planning stages.

The project by TTLC Los Angeles – El Sereno, an affiliate of True Life, includes 42 homes on a hillside lot in L.A.’s El Sereno neighborhood.

Aidan Barry, an executive vice president at TTLC, expressed relief the firm could proceed with the project after obtaining an approved vesting tentative map. However, the journey has been fraught with legal hurdles and delays.

The project, launched in 2017, faced initial challenges requiring a mitigated negative declaration and zoning change.

After a settlement of an initial lawsuit filed by the open space advocacy group led to an agreement by TTLC to plant another 225 black walnut trees, the project won approval from Los Angeles planning authorities, including its compliance under the California Environmental Quality Act, or CEQA. 

The group then filed a second lawsuit contesting the negative declaration, while demanding a time-consuming Environmental Impact Report. A lower court judge agreed in favor of the group.

The appellate court ruling is expected to streamline future development processes, reducing prolonged legal battles and associated costs, according to Brooke Miller, a special counsel with Downtown-based Sheppard Mullin Richter & Hampton, who represented TTLC in the suit.

“That’s almost four years that this project has been in limbo from when it was first approved,” Miller said. “Things like this should not be taking four years.”

Developers hope it will encourage opponents to file challenges at earlier stages, minimizing project delays. Mark Weinstein of MJW Investments praised the decision, emphasizing the importance of timely project approvals in mitigating costs and uncertainties.

Despite the challenges, TTLC remains committed to completing the El Sereno project, their first venture in Los Angeles.

Barry, in charge of the El Sereno project, estimated that after $3 million per acre of horizontal grading and $150 per square foot of construction, the homes, if listed today, would sell for $1.2 million each.

“I have to add all of those legal costs to the price of the home,” Barry told the Business Journal. “The more time that goes on, it’s not just the legal fees. It’s the cost of that effort, plus the rising cost of materials.”

— Dana Bartholomew

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The man behind “Star Wars” now owns a cold storage and industrial facility in L.A.’s Chinatown. 

Filmmaker George Lucas’ family office, Skywalker Holdings, has bought a roughly 155,000-square-foot site at 1600 Naud Street for $45.5 million, according to property records filed with L.A. County. The limited liability company on the deed was signed by Michael Rider, the treasurer of the Lucas family’s foundation.

The deal came out to around $293 a square foot. CoStar first reported the deal.

Santa Monica-based Redcar Properties, which sold the property, had planned to raze the cold storage warehouse and other ancillary structures and build a 147,000-square-foot office development, with restaurant and retail space, L.A. city planning documents show. 

However, Redcar notified the city last month that it would pull its plans. 

The sale to Lucas triggered a $2.77 million transfer tax, under the city’s new 5.5 percent tax on all sales above $10 million, the deed shows. 

It’s unclear whether Skywalker Holdings will file new development plans, or keep the property as a cold storage and industrial facility. However, Lucas is planning to open the $1 billion Lucas Museum of Narrative Art next year in L.A.’s Exposition Park.

Skywalker Holdings’ most prominent real estate is the 4,700-acre Skywalker Ranch in Marin County, about 40 minutes north of San Francisco, home to a working farm with Wagyu cattle, a winery and a movie studio. The family office also owns vineyards in France. 

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A newly built mansion perched on a promontory above the Sunset Strip in Los Angeles has sold for $25.6 million, marking the priciest home sale in L.A. County so far this year. 

At the same time, the property traded for about half its original asking price, adding to a list of luxury homes in the L.A. market whose aspirational values fall before finding a buyer.

The mansion, located at 8201 Bellgave Place, is a four-bedroom, four-bath home designed by South African architecture firm SAOTA. It has a heated pool and spa, a walk-in wine cellar and outdoor lounge areas. It offers views stretching from the Griffith Observatory to the Pacific Ocean, according to a listing on Zillow. 

The property sits adjacent to the Stahl House, the Modernist mansion described by historic preservation organization L.A. Conservancy as “one of the most iconic and photographed houses in the world.” 

The seller of 8201 Bellgave is spec developer Clive Robertson, who heads a company called Centurion International. Robertson first listed the property in 2022 with a much higher price tag of $48 million. He finished construction on the home that year. 

Months later, he cut the asking price to just under $40 million. The purchase price amounts to a 46.7 percent discount from the home’s initial asking price. The deal closed on Feb. 1, property records show. 

The buyer is an entity called TechGenius Holdings CA LLC, which is managed by a British Virgin Islands company called Green Technologies and System Limited. The sole manager for the entity is SaiHui Tang.  
The deal displaced the sale of the Bel-Air home of Hilton & Hyland co-founder Rick Hilton from the top of the rankings. The mansion, which was bought by Chinese billionaire Zong Qinghou, closed at $25 million in early January. Another expensive home sale that closed this year involved investor Alon Abady. He recently sold 910 North Alpine Drive, a 10,000-square-foot mansion in Beverly Hills, for $24 million. 

The post Sunset Strip spec home fetches $26M, priciest LA deal this year appeared first on The Real Deal.

Blackstone and Worthe Real Estate Group have listed a 1.5 million-square-foot office and industrial campus in Lincoln Heights for sale, with bids expected up to $200 million.

The New York-based alternative asset manager and the Santa Monica-based developer led by Jeff Worthe have put the former Forever 21 headquarters at 3880 North Mission Road on the market, Bisnow reported.

The joint venture bought the eight-building campus east of Downtown Los Angeles in late 2018 for $166 million. The industrial complex includes 265,000 square feet of offices. A $200 million sale would work out to $133 per square foot.

The 39-acre property has been approved for a 1 million-square-foot development of three mostly industrial buildings, according to Green Street’s Real Estate Alert. 

In 2022, Blackstone and Worthe sought permits to bulldoze and redevelop the site, according to Bisnow.

Brokers Jeff Stephens and Cameron Merrill of CBRE hold the listing. Marketing for the triangular property focuses on the ability of a buyer to have a shovel-ready industrial project with all the permits needed to break ground.

Under the approved plan, seven of the property’s eight buildings would be demolished. 

In 2022, Forever 21 moved its headquarters from Lincoln Heights to Downtown. Sparc Group,  parent company of the apparel retailer, inked a lease for 164,000 square feet of offices at the California Market Center at 110 East 9th Street.

Worthe Real Estate has a deal to redevelop the 30-acre Warner Bros. Ranch in Burbank and a plan to build 60 apartments in Santa Monica.

— Dana Bartholomew

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Some mall owners might struggle with retail tenants filing for bankruptcy, exiting spaces and refinancing debt. But, apparently not Macerich. 

Macerich reeled in $62.2 million in net income during the last three months of 2023 — or 3,580 percent more than the $1.7 million in profit it reported in the fourth quarter of 2022, according to an earnings release on Wednesday. 

“Congratulations on a great ‘23,” an analyst said on a conference call discussing Macerich’s quarterly earnings Wednesday. 

The Santa Monica-based real estate investment trust still ended the year with an annual loss of $274 million, mostly attributed to $134 million in asset write-downs. 

Macerich reported $884 million in revenues in 2023, up from $859 million in 2022, financial filings show. 

Macerich also ended the year closing refinancing deals on some of its debt, pushing out near-term maturities, as many other mall owners have defaulted on loans tied to properties. 

About 6 percent of all commercial mortgage-backed securities loans tied to retail properties were delinquent last month — about the same as office, but higher than other asset classes. 

In December, Macerich and a joint venture partner scored a $710 million, fixed-rate loan to refinance its Tysons Corner Center in Virginia. Last month, the company closed a $155 million, fixed-rate loan to refinance the Danbury Fair Mall in Connecticut.

Also last month, Macerich repaid most of the loan tied to its Fashion District Philadelphia, an 803,000-square-foot mall. 

On the leasing front, 93.5 percent of its portfolio was occupied at the end of last year, up from 92.6 percent at the end of 2022 and 91.5 percent in 2021. But leasing is likely to slow over the next year.

“We’re running out of large-format inventory — we’re running out of boxes, big anchor locations,” Macerich CFO Scott Kingsmore said on the company’s earnings call. 

Macerich also is kicking off the year with an executive shakeup. Earlier this month, the company announced CEO Thomas O’Hern would retirie at the end of February. Jackson Hsieh, the former CEO of Spirit Realty, will take over on Feb. 29. 

The post Macerich reports 3,600% profit jump in Q4 while “running out of anchor space” appeared first on The Real Deal.

Bolour Associates has secured permission to build a 30-unit apartment complex in West Los Angeles.

The Beverly Hills-based developer was approved to build the five-story complex at 2424 Veteran Avenue, in Rancho Park, the Commercial Observer reported. It appears it would replace a commercial storefront, according to Google Maps.

Plans call for a five-story complex on the corner of West Pico Boulevard with 30 studio, one-bedroom and two-bedroom apartments from 475 to 975 square feet. 

The project will include three live-work apartments, which could support uses from artist studios to professional offices. The complex will have two rooftop decks, and an unspecified amount of on-site parking.

The property is a few blocks east of the 405 Freeway and less than half a mile north of the 10 Freeway, as well as a few minutes walk west of the upcoming UCLA Research Park, according to the Observer.

Last month, UCLA announced it had purchased the 687,000-square-foot former Westside Pavilion mall for a new research park, paying Macerich and Hudson Pacific Properties $700 million. 

A mile west, Penske Media, publisher of Variety and Rolling Stone, signed a 12-year, 125,000-square-foot lease in September for the new Lumen office building at 11355 West Olympic Boulevard, the Observer reported.

In December, Bolour Associates filed plans to turn the top floor of a century-old commercial landmark in Hollywood into eight live/work apartments at 6464 West Santa Monica Boulevard.

The adaptive-reuse proposal calls for eight one-bedroom flats, with dedicated work areas, plus replacing a ground-floor theater with 5,600 square feet of shops.

A year ago Bolour pursued another project when it filed plans to build a seven-story, 61-unit apartment complex at 4800 Melrose Avenue in East Hollywood.

— Dana Bartholomew

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A Koreatown property owner has tweaked plans for a six-story hotel to include an extra floor and 20 apartments. 

EWAI, an architecture firm based in Koreatown, has filed revised plans on behalf of owner Mike Barry to build a seven-story, 60-room hotel with 20 apartments at 3216-3222 West 8th Street and 800-814 ½ Mariposa Avenue, Urbanize Los Angeles reported.

It would replace a four-unit apartment complex and parking lot.

Barry’s initial plans, filed in 2018, called for a hotel and residential project. In 2022, he revised his plans to feature a six-story, 95-room hotel. He’s now reverted to his original proposal.

Plans now call for a seven-story building with a 60-room hotel, with 20 apartments above 4,000 square feet of shops and restaurants. A three-level underground parking garage would serve 71 cars.

The U-shaped project, designed by EWAI, would include separate hotel and residential wings, with swimming pools at the second floor and rooftop. The hotel would include a 1,400-square-foot rooftop bar.

The proposed hotel and apartment building has mostly floor-to-ceiling windows, and is trimmed in white, gray and slate blue, according to a rendering.

Pending approvals and a zone change, the developer would break ground late this year and complete the hotel/apartment project in 2026.

Mike Barry owns the H Hotel at 3206 W 8th Street in Koreatown, adjacent to the proposed 60-room hotel and apartments.

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Last year, an investigative report by ProPublica accused Barry and other Los Angeles hotel owners of illegally turning residential hotels for low-income residents into boutique hotels for tourists, charging more than $200 a night. 

A hotel manager said the hotel hadn’t accepted long-term residents since 2019, and asked the city to remove its residential designation.

— Dana Bartholomew

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Panku, a real estate development firm run by Alex Wang, has refinanced an apartment complex in Irvine — the first project the company completed. 

Western & Southern Life Assurance provided a five-year, $82 million loan on 17600 Cartwright Road, according to property records filed with Orange County. A team led by Northmarq’s David Gahagan and Chris Hammel arranged the financing and announced the deal on Thursday, but did not disclose the lender. 

The loan was used to pay off outstanding debt and “reimburse cost overruns,” Gahagan said in a statement. 

Panku completed the 272-unit project in 2021. The same year, Panku scored an $80 million loan from Shanghai Commercial Bank, with a floating interest rate, records show. 

Insurance companies are one of the few lenders still willing to hand out debt on multifamily projects, according to brokers and developers in Southern California.

After the collapse of First Republic Bank last year and JPMorgan’s subsequent acquisition of the bank, regional banks started pulling back from lending on multifamily, construction and other commercial real estate projects. 

At the property, 28 of the units were classified as affordable and included in the City of Irvine’s affordable housing lottery. 

Monthly rents at the complex range from $2,795 for a 615-square-foot, one-bedroom to $4,395 for a two-bedroom unit, according to listings on RentCafe. Those numbers are about in line with average rents for Irvine, Zumper data show. 

Western & Southern Life Assurance is part of Western & Southern FInancial Group, based in Cincinnati.

The post Panku scores $82M refinance for Irvine multifamily complex appeared first on The Real Deal.

Dollinger Properties is prepared to sell a 146,000-square-foot office building in Brea for less than it paid for the property in 2019. 

The Redwood City-based firm has put 1800 East Imperial Highway up for sale with an asking price of about $27 million, according to a LoopNet listing. A Newmark team led by Kevin Shannon is marketing the property, named Fairway Center I. 

The listing marks the second time Dollinger has tried to sell the property in the last two years. In July 2022, the firm listed the property for $35 million, according to reports.

Dollinger bought the building for $33.5 million in 2019, records filed with Orange County show, or about $230 per square foot.

If the office building sells for $27 million, the deal would come out to about $185 a square foot. The sale would represent about a 20 percent discount from Dollinger’s purchase price five years ago. 

The owner is offering assemble, non-recourse debt — about $23 million, set to mature in May 2029. The loan has a fixed interest rate of 4.66 percent, lower than the secured financing overnight rate during the last year. 

Newmark is presenting the listing as an opportunity for a tenant to buy its own office space, given the property is currently vacant. 

The property is advertised for lease at $28.20 per square foot a year. To lease the entire building at that price, a tenant would pay about $4.1 million annually. Leasing the building for 10 years would cost a tenant $40 million, significantly higher than the asking price.

When Dollinger bought the building, the property was nearly 90 percent occupied, according to CoStar.

Last year, Dollinger paid $54 million to buy the open-air mall Plaza at Golden Valley in Santa Clarita.

The post Dollinger Properties lists Brea office at 20% discount to last buy appeared first on The Real Deal.

A firm run by Jordan Shalom wants to build an 11-story affordable apartment building in the Hollywood Hills under a fast-track order by Mayor Karen Bass.

The Beverly Crest-based LLC, 3450 Floyd, filed an application under the mayor’s Executive Directive 1 to build the 68-unit highrise at 3446 North Floyd Terrace and 3445 North Barham Boulevard, Urbanize Los Angeles reported. It would replace a vacant lot.

Plans call for 68 studio, one- and two-bedroom apartments above a two-level, 24-car garage a half mile east of the 101 Freeway, a quarter-mile south of Universal Studios.

Bass issued her policy, known as Executive Directive 1, during her first week in office in late 2022 as a way to encourage the construction of affordable housing and end homelessness.

The affordable housing option allows developers to quickly approve large, 100-percent affordable housing projects. 

ED1 approvals can save developers tens of thousands of dollars in permitting fees, while exempting them from some environmental studies and public hearings. By sidestepping a review from the Planning Commission, builders save both time and money — with less risk of projects being killed during the city’s complicated “discretionary review process.”

Shalom seeks ED1 density bonus incentives to allow a larger structure than would otherwise be permitted by zoning rules. The project is eligible for the incentives, as all of the proposed apartments would be set aside for rent below market rate, according to Urbanize.

The 120-foot building, designed by Culver City-based Open Office, soars above a bank of trees, with clean, geometric angles that include large windows and inset balconies.

While ED1 projects are rare in the Hollywood Hills, Open Office has worked on several others across Los Angeles, including two with SoLa Impact on Broadway and Normandie Avenue in South Los Angeles, according to Urbanize.

Last month, the Oakland-based Yes In My Back Yard and an affiliate of Chatsworth-based Uncommon Developers sued L.A. after the City Council refused to allow the builder to employ ED1 to construct a tall apartment building in a single-family neighborhood in Winnetka.

The mayor’s executive order, which initially didn’t prohibit ED1 projects in single-family communities, was followed by applications for eight affordable complexes in San Fernando Valley neighborhoods. They included plans by Uncommon to build an 80-foot building next to homes.

In June, Bass updated her directive to close the loophole. 

— Dana Bartholomew

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The Greenberg family behind the Skechers shoe empire has stepped into a newly created compound in Hermosa Beach, valued at $31 million.

An affiliate of the Manhattan Beach footwear brand founded by Robert Greenberg and his son, Michael, bought a 2,800-square-foot home at 2900 Tennyson Place for $15.4 million in an off-market deal, according to the Robb Report.

The three-bedroom, four-bathroom home sits next to a 7,300-square-foot estate at 2906 Tennyson the Greenbergs bought in 2019 for $16 million.

The combined properties create a two-thirds-acre estate in a cul-de-sac with two homes at a purchase price of $31 million.

The Greenbergs’ latest South Bay home is a typical suburban beach house atop an attached two-car garage. The gray wooden rambler with white trim, built in 1946, has been updated. It recently listed for rent at $14,750 a month.   

It has a window-walled living room with a fireplace, as well as built-in shelving and doors spilling out to the backyard. 

Highlights include a couple of dining areas, a kitchen with blue-and-white cabinets and stainless appliances, and a den warmed by a Franklin stove.

The master bedroom has a fireplace, sitting area, walk-in closet, newly remodeled bath and access to a patio. Its tiered grounds have ocean views.

Five years ago, the Greenbergs bought the house next door from former ballroom dancer/vitamin company founder Esmeralda Gallemore and her husband Ron.

Built in 2015, the five-bedroom, seven-bath home has a pool, sports court, fire pit, seven-car underground garage and coastal views from Palos Verdes to Malibu.

According to Forbes, the Greenbergs are one of the nation’s richest families, with an estimated net worth around $1.5 billion.    

— Dana Bartholomew

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Double-barreled storms across Southern California this month caused hundreds of mudslides — and highlighted an increasing risk of flooded homes.

One in five residential properties, or 1.1 million houses, condominiums and apartments across six Southland counties, have a moderate or greater risk of suffering damage from flash floods, the Orange County Register reported, citing risk data from CoreLogic.

It defined flash floods as “when precipitation rates are greater than the speed at which water drains into the ground surface.”

Overall, 21 percent of local housing face the risk of floods, according to the Register.

Urban areas like Los Angeles have a high risk of floods because abnormal amounts of rain can’t drain into the soil on streets, parking lots and concrete surfaces.

Streets can overflow with rain, creating rushing creeks that cause damage. Mountain slopes funnel deluges onto the flats, creating more flooding.

Weather gurus tell the Register such storms will be more frequent as the region grapples with climate change. Also, property owners should know that typical home insurance policies don’t  cover flood damage, so a separate flood policy is required.

An average home in Southern California would cost $454,000 to rebuild, assuming a flooded home was a complete loss. That adds up to a $487 billion replacement risk across the region.

CoreLogic estimates that 28 percent of the 1.1 million Southern California homes facing flash flood risk have an elevated risk of damage. That’s 305,224 homes at greater risk of harm.

The areas at highest risk include Los Angeles, Riverside and San Bernardino counties, according to the Register.

In Los Angeles, 420,585 homes are at risk, with 27 percent of those properties in higher danger. In Riverside, 211,418 are at risk, with 39 percent at higher danger. In San Bernardino, 156,987 are at risk, with 31 percent at higher danger.

Orange, San Diego and Ventura Counties were at far less risk, with around 21 percent of homes in higher danger.

— Dana Bartholomew

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A social media-famous plastic surgeon has bought an office building in Beverly Hills for about $921 a square foot, one of the priciest office deals in the last year on a per square foot basis. 

Daniel Barrett, who runs Barrett Plastic Surgery and has almost 1 million followers on Instagram, bought 501 South Beverly Drive for $21.3 million, according to property records. 

Ray Rowshankhah, the founder of Del Ray Realty, arranged financing for the deal, while Brandon Michaels at Marcus & Millichap represented the buyer. 

Alon Abady, who owns a number of office buildings and hotels across Beverly Hills and West L.A., sold the building after owning it for more than 20 years, records show. 

Barrett plans to build out about half of the building into medical space, fit for a surgery center with operating rooms and a medical spa, he confirmed over email. The remainder of the building would be leased out to tenants. 

To close the deal, Barrett scored a $13.75 million loan from First Citizens Bank and more than $4 million in financing through the Small Business Administration’s 504 loan program, according to Rowshankhah. 

In total, the deal was about 85 percent loan-to-value — terms that surpassed “usual market offerings for a commercial loan of this caliber,” Rowshankhah said. 

Beverly Hills is a bright spot for L.A.’s office market, with a handful of deals trading for more than $900 a square foot in recent months, compared to Downtown Los Angeles, where office towers have traded for less than $140 a square foot. 

Last month, sports betting company FanDuel paid $71 million for a 50,200-square-foot office building at 9000 Wilshire Boulevard, coming to $1,410 per square foot. 

In a report from CBRE that looked specifically at the L.A. medical office market, the average price per square foot for the first three quarters of last year was about $360, compared to more than $600 for all of 2022. The average asking rate for medical office leases was $5.56, well above the L.A. market average of $3.86, but trailing pricey West Hollywood, Santa Monica and Westwood.

The post Plastic surgeon buys Beverly Hills office for nearly $1,000 psf appeared first on The Real Deal.

A Los Angeles court has denied Leo Pustilnikov’s application to build a 35-unit apartment project in Redondo Beach, following a tentative ruling a week ago.

“The court rules in accordance with its tentative ruling,” according to court papers. 

Pustilnikov plans to appeal the decision.

“It’s clear the housing laws apply throughout the state, not just the non-coastal areas,” he told TRD. “The Coastal Act is intended to provide housing equality, not housing exclusivity.”

Last week, L.A. County Superior Court Judge James Chalfant ruled that the site, located at 1021 North Harbor Drive, is not zoned for residential property.

Chalfant wrote that “nothing in the Coastal Act, the Local Coastal Program and the Coastal Ordinance prevents low- and moderate-income housing from being built in the coastal zone,” while noting that “it must be based in residential zones within the coastal zone.” 

The case is closely watched by developers and cities as one of the earliest builder’s remedy applications filed last year, offering insight into the future of the builder’s remedy provision in California after a flurry of filings in 2023.

Despite the court’s denial of Pustilnikov’s project and his planned appeal, the case adds to the growing body of legal decisions demystifying how the builder’s remedy works and its potential applications.

“That’s what this decision and the larger narrative that this decision contributes to,” Chris Elmendorf, a professor at UC Davis School of Law, told TRD last week. “There are more and more signals that state officials are going to have the backs of the people who are trying to build housing.” 

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A newly built mansion perched on a promontory above the Sunset Strip in Los Angeles has sold for $25.6 million, marking the priciest home sale in L.A. County so far this year. 

At the same time, the property traded for about half its original asking price, adding to a list of luxury homes in the L.A. market whose aspirational values fall before finding a buyer.

The mansion, located at 8201 Bellgave Place, is a four-bedroom, four-bath home designed by South African architecture firm SAOTA. It has a heated pool and spa, a walk-in wine cellar and outdoor lounge areas. It offers views stretching from the Griffith Observatory to the Pacific Ocean, according to a listing on Zillow. 

The property sits adjacent to the Stahl House, the Modernist mansion described by historic preservation organization L.A. Conservancy as “one of the most iconic and photographed houses in the world.” 

The seller of 8201 Bellgave is spec developer Clive Robertson, who heads a company called Centurion International. Robertson first listed the property in 2022 with a much higher price tag of $48 million. He finished construction on the home that year. 

Months later, he cut the asking price to just under $40 million. The purchase price amounts to a 46.7 percent discount from the home’s initial asking price. The deal closed on Feb. 1, property records show. 

The buyer is an entity called TechGenius Holdings CA LLC, which is managed by a British Virgin Islands company called Green Technologies and System Limited. The sole manager for the entity is SaiHui Tang.  
The deal displaced the sale of the Bel-Air home of Hilton & Hyland co-founder Rick Hilton from the top of the rankings. The mansion, which was bought by Chinese billionaire Zong Qinghou, closed at $25 million in early January. Another expensive home sale that closed this year involved investor Alon Abady. He recently sold 910 North Alpine Drive, a 10,000-square-foot mansion in Beverly Hills, for $24 million. 

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Blackstone and Worthe Real Estate Group have listed a 1.5 million-square-foot office and industrial campus in Lincoln Heights for sale, with bids expected up to $200 million.

The New York-based alternative asset manager and the Santa Monica-based developer led by Jeff Worthe have put the former Forever 21 headquarters at 3880 North Mission Road on the market, Bisnow reported.

The joint venture bought the eight-building campus east of Downtown Los Angeles in late 2018 for $166 million. The industrial complex includes 265,000 square feet of offices. A $200 million sale would work out to $133 per square foot.

The 39-acre property has been approved for a 1 million-square-foot development of three mostly industrial buildings, according to Green Street’s Real Estate Alert. 

In 2022, Blackstone and Worthe sought permits to bulldoze and redevelop the site, according to Bisnow.

Brokers Jeff Stephens and Cameron Merrill of CBRE hold the listing. Marketing for the triangular property focuses on the ability of a buyer to have a shovel-ready industrial project with all the permits needed to break ground.

Under the approved plan, seven of the property’s eight buildings would be demolished. 

In 2022, Forever 21 moved its headquarters from Lincoln Heights to Downtown. Sparc Group,  parent company of the apparel retailer, inked a lease for 164,000 square feet of offices at the California Market Center at 110 East 9th Street.

Worthe Real Estate has a deal to redevelop the 30-acre Warner Bros. Ranch in Burbank and a plan to build 60 apartments in Santa Monica.

— Dana Bartholomew

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Clik here to view. Forever 21 sells its HQ in Lincoln Heights for $166M

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