LOS ANGELES—Canadian-based investor RC Acquisitions has acquired the National City Tower in Downtown Los Angeles for $43.3 million from National City Towers LLC. The 12-story, 118,162-square-foot building is a historic adaptive reuse development with 93 multifamily units and ground floor retail space.

“With Downtown Los Angeles hitting peak levels of capital infusion over the past year, we advised the seller on the benefits of asset disposition at this particular point in time,” Bryan Glenn, a broker with Charles Dunn Co., tells GlobeSt.com. “Interest rates remain low; however, next year they are predicted to increase. Investors are aggressively seeking to spend pent up capital before rates rise and get into core markets like this one.” Glenn represented the seller and the buyer in the transaction along with his Charles Dunn colleague, Janet Neman. Sklar Kirsh attorney Andrew Kirsh provided legal counsel to the buyer in the transaction.

Glenn and Neman received significant interest in the listing, which resulted in seven offers from a range of investors, including institutional, private and foreign. “The buyer was selected because it was a well-capitalized and experienced owner that made a competitive offer,” Glenn explains. The property's retail portion is fully occupied, while the residential units are 97% occupied. This, no doubt, attracted the high level of interest from investors. Neman tells GlobeSt.com that this buyer was attracted to the property because it “owns other high-end residential properties in Southern California and had been seeking a residential opportunity in Downtown.”

In addition to strong occupancy, the property's prime downtown location was also a major selling point. “I believe that Downtown L.A. is truly evolving into a Manhattan-like, 24/7 market,” says Neman. “A core asset like National City Tower feeds into this evolution as demand for housing and convenient amenities increases as capital is poured into all corners of the Downtown market.” Located at 810 South Spring Street in the financial district, the building was redeveloped in 2008 into a luxury multifamily complex. Because of its historical status, it benefits from the Mills Act Historical Property Contract program that allows homeowners to receive a reduction in property tax.

The property came to market early this year. It was listed for $45 million with a 4.7% cap rate. The 93 units include a mix of studio, one- and two-bedroom apartments, ranging in size from 617 square feet to 1,884 square feet. Tenants occupying the retail portion include Terroni, Peking Tavern and Crane's Downtown Bar.