COVER STORY, APRIL 2005

RESIDENTIAL RACE FOR SPACE
Housing demand, urban development and mixed-use momentum have created a lively multifamily market.
Haley Shuler and Brian A. Lee

High-growth markets, coupled with intense competition for land, have led to high-rise development and conversion trends in many of the West’s multifamily sectors. Western Real Estate Business sampled a number of projects to check out the market’s direction.

Bank Lofts

In San Pedro, California, Urban Pacific Builders is converting the 1924-vintage Bank of San Pedro into loft-style condominiums.

Long Beach, California-based Urban Pacific Builders LLC and Phoenix Realty Group have recently closed escrow on the Bank Lofts at San Pedro, which will create 89 loft-style condominiums in the historic 1924-vintage Bank of San Pedro building near the Port of Los Angeles. The Bank Lofts, one of several new redevelopments slated for the area, represents the first new multifamily project in downtown San Pedro.

According to Scott Choppin, managing partner of Urban Pacific Builders, “San Pedro, like other downtown areas, is becoming more popular as a destination, and like other revitalized downtowns, urban housing will be an increasingly important part of the mix.”

The existing bank building, located at the corner of Seventh Street and Mesa Avenue, will be retrofitted with approximately 3,800 square feet of ground-floor retail space, new flats on the second floor and new two-story loft penthouses on the present roof level. Across the street at Eighth and Mesa, a second building, comprising four stories of units atop a parking garage, will be constructed on a vacant parcel, boosting the size of the two-building project to 200,000 square feet. Spanning from 975 to 2,650 square feet, Bank Lofts at San Pedro will start in the low- to mid-$300,000s and be a mix of flats and two-story townhomes, along with additional penthouse units. The $30.6 million development, which broke ground last fall and is scheduled for completion in spring 2006, also includes 154 subterranean parking spaces.

“It’s a vibrant community with a lot of charm and personality, as well as a great deal of local history,” says Mark Tolley, managing partner of Urban Pacific Builders. “It all adds up to making downtown San Pedro a great place to live.”

Jay Stark, managing partner of Phoenix Realty Group, says, “The Bank Lofts project offers home ownership opportunities to middle-income workers with a strong desire to live in a vibrant urban core close to the regional job centers of Long Beach, north Orange County and downtown Los Angeles.”

Strategically located within the San Pedro Arts District, the project is surrounded by commercial/office uses to the north, live-work spaces and artist galleries to the east, a senior’s center and public park to the south, and multifamily residential uses to the west.

The combination of the bank’s historical façade and new modern architecture will help promote Bank Lofts as one of San Pedro’s new signature residential communities.

Irvine, California-based KTGY Group Inc. is project architect and the general contractor is Forefront Builders Corp., based in Thousand Oaks, California.

Las Vegas CENTRAL

This summer, Langson Development will break ground on Las Vegas CENTRAL, a condominium community situated on 5.5 acres on Sierra Vista Drive between Paradise Road and Swenson Street in Las Vegas. The $400 million project will encompass two 52-story towers with 500 condominium units each, along with 105,000 square feet of retail, entertainment and office space. Units will range from 422 to 1,900 square feet. The development is slated for completion in summer 2007.

“What’s most unique about Las Vegas CENTRAL are the added amenities and exceptional design being used to draw residents into the community,” says Bruce Langson, president of Langson Development and managing member of Nevada Towers LLC, owner of the project. “Las Vegas CENTRAL is not located on the Vegas strip or a major street, so the development is very much driven by creating incentives to draw interest.”

Some of the development’s amenities and features include an outdoor amphitheater, several upscale restaurants, a supper club, a bookstore and numerous other vendors such as an upscale market, deli and shops that would be more common to a 1,000-unit luxury subdivision.

Venice, California-based Jerde Partnership, designer of several renowned projects such as the Mirage, Bellagio and Treasure Island hotels, is the conceptual architecture firm, with JMA Architecture Studios serving as the executive architectural firm.

According to Langson, the area around Las Vegas CENTRAL has been in decline for some time, and the development of the community is motivated by a desire to revitalize the area.

As the first major project in the area, Las Vegas CENTRAL will kick off long-term plans for redeveloping the area, including the installation of a regional transportation system. After its completion, Las Vegas CENTRAL will be the crowning jewel to the new central Las Vegas neighborhood, says Langson.

Market Lofts

In March, CIM Group broke ground on Market Lofts, the second phase of the company’s $500 million South Village development, a 7.2-acre mixed-use development bounded by Eighth, Ninth, Flower and Hope streets in Los Angeles. CIM Group, in conjunction with the Los Angeles Redevelopment Agency, was able to secure the land parcel that paved the way for the development of South Village. Phase II will include six levels of loft-style condominiums containing 267 units along with 56,000 square feet of retail space.

PCL will serve as project contractor and RTK Architects is the design firm. CIM Group has selected the Lee Group to develop the condominiums, continuing their partnership that began with the Flower Street Lofts, which contributed to the for-sale housing boom in downtown Los Angeles.

“The for-sale market remains very strong in downtown,” says Shaul Kuba, principal of CIM Group. “Housing demand, coupled with other market factors, led us to rethink our timetable and bring condominiums, instead of apartments, into this second phase rather than in later phases of the development as previously planned.”

Market Lofts will be built above a 50,000-square-foot Ralphs supermarket and 6,000 square feet of retail and restaurant space. The Coffee Bean & Tea Leaf, Quiznos Sub, Coldstone Creamery and a UPS Store have already signed leases. Ralph’s will be the first large, full-service grocery store in downtown Los Angeles, a key element to securing its future as a desirable, residential community. “Housing in this area of downtown, known as South Park, is particularly attractive as it is convenient to restaurants, shopping, entertainment and the subways,” says Jeff Lee, president of the Lee Group.

The 267 condominiums will be built around a swimming pool atop the market with a central landscaped plaza, spa and clubhouse. A 319-space parking structure will be constructed behind the building to provide owners with direct access to residential floors. Subterranean parking will serve patrons of Ralphs and the other shops and restaurants.

The first phase of the five-phase development was completed in early 2004 with the opening of the 251-unit Historic Gas Company Lofts, which are currently more than 80 percent leased. Following the completion of Market Lofts in December 2006, CIM Group is planning to develop 700 additional housing units on the three remaining sites flanking Market Lofts.

Scottsdale Waterfront Residences

Situated prominently on the corner of Scottsdale and Camelback roads, just north of downtown Scottsdale, Arizona, and fronting the Arizona Canal, Scottsdale Waterfront Residences will consist of 410,000 sellable square feet of luxury condominium space across twin 13-story towers. The towers contain 198 units ranging from 1,100 to 5,000 square feet.

The mixed-use Scottsdale Waterfront will also feature 200,000 square feet of retail, restaurant and office condominium space. P.F. Chang’s China Bistro, Eddie V’s Seafood Grill, Sauce pizza and wine concept, Sur La Table, Isaac Jewelers, Border’s Books & Music and Waterfront Market have already committed to the development.

The $200 million Scottsdale Waterfront Residences broke ground in January. The first residential tower is scheduled for completion in fourth quarter 2006, the second in first quarter 2007. OWR Development, an affiliate of Phoenix-based Opus West and a member of the Opus Group of Companies, is the lead developer and Geoffrey H. Edmunds & Associates is a development partner. The executive architect is Opus Architects & Engineers and the design architectural team is Solomon Cordwel Buenz & Associates, working in association with H&S International LLC.

“When complete, Scottsdale Waterfront Residences will be the most visible element of downtown Scottsdale and one of just a handful of luxury projects that are satisfying a growing desire for vertical multifamily living opportunities in Phoenix,” says Jeff Roberts, vice president of real estate development at Opus West Corp.’s Phoenix headquarters, who notes that 65 percent of the development is already reserved.  

Amenities at Scottsdale Waterfront Residences will include a concierge service, state-of-the-art fitness center, business center with conference room, rooftop pool and spa with 360-degree views of the surrounding mountains and cityscape, and a residents’ club.  

Century Plaza

Equus Development is converting Century Plaza, a 218,532-square-foot office building in Phoenix, into a condominium community.

“We were excited about the opportunity to develop under-performing real estate assets into residential uses,” he says.

In December, Equus Development put its condo conversion plan into action, buying the $9.8 million Century Plaza in Phoenix from New York-based The Praedium Group. The 15-story building, located next to Park Central at 3225 N. Central Ave., is a 218,532-square-foot midtown office property that was built in 1974 and renovated in 1990.

“Century Plaza is uniquely situated in the center of the most densely occupied commercial area of midtown Phoenix and is located less than 200 feet from the new light-rail station being built at Osborne and Central, which will give residents easy and quick access to downtown Phoenix, SkyHarbor International Airport as well as Arizona State University and the city of Tempe,” says Edgelow. “Century Plaza is also within 200 feet of the shops and restaurants located across the street at Park Central Mall, giving it a unique urban feel for Phoenix.”

The first phase will comprise 140 condo units. Two additional towers will be constructed, featuring approximately 300 more units. The condos will range in size from 650 square feet for the one-bedrooms to approximately 1500 square feet for the three-bedroom floor plans. Buyers will also have the option to combine units to create a larger floorplan. Edgelow says that Equus is aiming to lease the ground-floor space to wine and coffee bar, restaurant, and neighborhood grocery retailers.

“We have started the renderings and floor plans for the condominium homes,” says Edgelow. “We have approximately 20 reservations already without even having [the sales office open or] formalized floor plans!”

Formed in 1995, Phoenix-based Equus Development will team with Dallas-based project architect Humphreys and Partners Architects on the $53 millionCentury Plaza condo conversion.

3800 Wilshire

Next month, San Francisco-based MacFarlane Partners and Forest City Residential Group, a subsidiary of Forest City Enterprises, will begin redeveloping and converting 3800 Wilshire, the former Getty Oil headquarters, to condominiums. The 3800 Wilshire project is MacFarlane Partners’ tenth property investment in Southern California as part of its joint venture with the California Public Employees’ Retirement System (CalPERS) to invest in urban-infill properties in major metropolitan areas nationwide.

Located on Wilshire Boulevard in Los Angeles, the 22-story 3800 Wilshire comprises 22 stories and 332,000 square feet of space. “We expect to build 260 studio, one- and two-bedroom condominium units on floors 3 through 22, with 23,000 square feet of retail space on the first and second floors,” says David Dressler, principal of acquisitions/development for MacFarlane Partners. “There is also an attached, five-story parking garage with over 560 parking stalls that will be part of the renovated property.” 3800 Wilshire will also include a 12,000-square-foot rooftop recreation area that features an outdoor swimming pool and indoor fitness center.

The condominium units, which will range from approximately 500 to 1,200 square feet, will feature an abundance of high-end amenities — private balconies, gourmet kitchens with granite countertops, 10- to 11-foot ceilings and hardwood floors. But the most notable attraction of 3800 Wilshire will be the unobstructed views it will provide residents in all directions. 3800 Wilshire towers at least seven floors over the next tallest neighboring property, revealing spectacular views of the downtown skyline, the Pacific Ocean or the Hollywood hills.

3800 Wilshire is located in the Hancock Park/Koreatown district and will offer residents a variety of shopping, dining and entertainment options within walking distance. “If people are living closer to their jobs, they are able to do more of what they want to do: spend more time at home or in their neighborhood rather than driving on the freeway or sitting in traffic,” says Dressler. “We think that professionals working downtown will find this a wonderful location, as will singles, couples and families who are already renting in the Koreatown area.”

NoHo Commons

Scheduled for completion this spring, the first phase of J.H. Snyder’s $200 million NoHo Commons development in North Hollywood will consist of 438 residential apartments situated around the North Hollywood Red Line subway station. The metro line station anchors the commercial core and welcomes both residents and visitors to NoHo’s acclaimed arts district. The second phase of NoHo Commons, which broke ground in September 2004, will feature approximately 300 loft residential units, 20,000 square feet of live-work space and 60,000 square feet of retail.

The development is within easy walking distance of the Academy of Television Arts, immediately north of Universal Studios and immediately west of Burbank, the headquarter city of Walt Disney Company and Warner Bros.

The Crescent

With the opening of The Crescent this spring, J.H. Snyder will have delivered Beverly Hills’ first new rental apartment units in nearly 25 years. Started in summer 2003, the $50 million development comprises 12 two-story brownstones, 76 luxury townhouse apartments and 40,000 square feet of Class A office space. It also has three levels and 534 spaces of underground parking.  

The Crescent is a unique project not only because it is situated in a city famous for its stringent approval process, but because it’s the first mixed-use project ever built in Beverly Hills. The city has a long-standing policy discouraging residential development on Wilshire Boulevard, its primary business street. As a result, The Crescent’s office space fronts Wilshire while the town homes face Crescent Drive.

VanTilburg, Banvard and Soderbergh was the architect of the development, which is adjacent to Spago restaurant and within easy walking distance of Rodeo Drive.

The Plaza Irvine

OWR Development and Geoffrey H.  Edmunds recently broke ground on The Plaza Irvine, a $240 million, 202-unit condominium community in Irvine.

McLarand Vasquez & Partners International is the architect of The Plaza Irvine, and Parisi Portfolio is providing the interior design work.

A unique component of the The Plaza Irvine is the Terrace, an appealing area that will link the two residential towers. Designed by award-winning landscape architect SWA, the Terrace will feature a main pool with separate spa, lap pool, gathering spaces and exotic gardens. Other Terrace amenities include a state-of-the-art fitness center, outdoor barbecues and resort-style cabanas.

Santee Court

Santee Court, a $163 million adaptive reuse project involving nine historic industrial buildings, is leading downtown Los Angeles’ rebirth as a 24-hour live-work market.

Started in 2003 by Los Angeles-based developer MJW Investments, the three-phased development will ultimately feature 445 industrial-style loft/condominiums, 100,000 square feet of retail space, various rooftop amenities and a 400-foot long courtyard/retail promenade. The first phase, completed in May 2004, consists of 165 apartments, the second phase 64 condos and the third phase 216 condos. The second and third phases are due to be completed in December 2005 and December 2006, respectively. Donald Alec Barany Architects (residential), Lehrer Architects (exterior) and Mia Lehrer & Associates (landscape) handled the design work for Santee Court.

“Santee Court is a catalytic development project that turned a blighted area into a residential community that improves the quality of life by providing mixed-income, affordable, work-force, and market-rate housing,” says Mark Weinstein, president and founder of MJW Investments. “The growing shortage of housing in Los Angeles has prompted the need to develop mixed-use projects. By providing space for a Rite-Aid drugstore, Subway eatery, drop-off drycleaners and other retail tenants, Santee Court is able to provide the much needed services for the businesses and residents in the  area.”

Moreno Valley

Tapping into the growth of the Inland Empire, Irvine, California-based Western National Realty Advisors, the development arm of Western National Group, has aquired an 18.8-acre apartment site in Moreno Valley, California. The firm will break ground this spring on a 320-unit, fully amenitized apartment community on the site. The development will feature 16 two- and three-story buildings, consisting of 68 one-bedroom, 160 two-bedroom and 92 three-bedroom units. Initial occupancy is scheduled for spring 2006.

Western National Group, a fully integrated multifamily firm founded in 1963, will handle the construction and property management duties as well on the Moreno Valley development. KTGY Group is the architect of the project, which is a key part of Western National’s goal to double the number of multifamily units owned and managed in the next 5 to 7 years.

Behind the gates of the community, residents will enjoy many amenities, including a swimming pool, spa, barbeque area, a 3,500-square-foot clubhouse with fitness center, business center, and community club room, all packaged in a quaint suburban neighborhood living environment.

©2005 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.