LOS ANGELES—A joint venture between ASB Real Estate Investments and Blatteis & Schnur has acquired five warehouse properties on Palmetto and Mateo Streets in the arts district of Downtown Los Angeles for $32.5 million. The firm plans to invest an additional $30 million, for a total investment of $62.5 million, to create a 125,000-square-foot retail property and a 430-stall parking structure.

The redevelopment will convert industrial zoned properties into commercial retail space. However, developers plan to keep the buildings' industrial elements, like the 24-foot ceilings and large open floor plates. Once complete, the development will feature 900 feet of ground-level store frontage. ASB hopes to attract a tenant mix of retail, restaurants and bars to the center, which will have one anchor tenant, either a major retailer or a grocer, which at this point, does not exist in the arts district area.

The arts district is one of the primary growth areas in the downtown market, with many developers snatching up remaining industrial space and converting it into commercial space. GlobeSt.com recently reported that Atlas LA 4^th Street LLC purchased the former Coca-Cola building in the arts district neighborhood for $19 million in what amounted to the largest single industrial acquisition in the past three years. Having purchased the building for $19 million, the developer plans to convert the property into creative office space.

According to Robert Bellinger, president and CEO of ASB Real Estate Investments, this is a nationwide trend. He explains that demographic shifts in major urban areas across the country are helping to revive old warehouse space and convert it into useable and resident-friendly retail, multifamily and office space. He emphasizes that the company will both honor the history and feel of the neighborhood, while creating a convenient retail space for residents.