A five-property apartment portfolio in Downtown Los Angeles has traded hands for $402 million. The deal is among the largest multifamily deals in Southern California in the last decade. Barry and Rommy Shy sold the assets to Laguna Point Properties, which has a 7,000-unit apartment portfolio. KW Commercial brokered the deal.

The five property-portfolio consists SB Manhattan, a 198-unit building at 215 W. 6th St.; SB Lofts, a 184-unit property at 548 S. Spring St.; SB Tower, a 263-unit property at 600 S. Spring St; SB Spring, a 178-unit property at 650 S. Spring St.; and SB Main, a 214-unit property at 111 W. 7th St. In total, the portfolio totals 1,037 units. The portfolio also includes 60,000 square feet of retail space; however, that space was retained by the sellers.

The seller converted all five properties into condominiums and subsequently apartments from other outdated uses using the city's adaptive reuse ordinance. All five properties are vintage 1930s and 1940s properties. Adaptive reuse has been a popular means of creating more housing stock in Los Angeles, which has limited developable land for new housing. That trend will likely continue this year as the city faces extreme demand to create more housing. The City of Los Angeles is considering leveraging adaptive reuse of existing, underused buildings to create as many as 100,000 more units in the coming years, according to Karin Liljegren, FAIA, founder and principal, OMGIVNING, who spoke about the strategy to do so at ULI's Spring Conference earlier this month in San Diego in the session, "CRE to Multifamily: What Makes a Successful Conversion."