HOLLYWOOD-Redwood Partners Inc. of Newport Beach has acquired a portfolio of four apartment properties totaling 222 units from Anaheim-based Milan Capital for more than $40 million. Redwood principal Scott McCarter tells GlobeSt.com that the Newport Beach, CA-based company, which is on the lookout for other apartment investments in L.A., is under way on significant interior and exterior upgrades to the properties.
The four assets are located at 1820 Whitley, 1837 Whitley, 6600 Yucca and 1823 Grace, all within a block of each other, in what McCarter calls a prime Hollywood location three blocks from the intersection of Hollywood and Highland. All four were encumbered by CMBS loans totaling about $20 million at sub-5% interest rates that had to be assumed as part of the nine-month, off-market transaction facilitated by Michael Balson of KW Commercial in which Redwood bought the properties.
McCarter describes the properties as “the best value-add opportunity in the Hollywood submarket." He adds, "We are effectively the second owner since they were built in the late 1980’s, as Milan bought them out of foreclosure in the early 1990’s."
McCarter continues: "The properties are in original condition with good structural components, but in desperate need of updating. We will create four boutique apartment properties that will feature service, design details, and finishes that will equal or exceed those found in today’s luxury apartments. This will be done at a fraction of replacement cost, which will allow the apartments to be offered at favorable rental rates.”
The 222 units include 73 studios, 82 one-bedrooms, 26 one-bedrooms with lofts and 42 two-bedroom units. The units range from 500 to 1,000 square feet, averaging 700 square feet. All are one-building properties, with four stories over two levels of parking.
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