For a long time, as young professionals aged into their late 20s / early 30s, they would move out of LA to suburbs in search of a big single family home with a yard, etc. Demand for apartments in LA, particularly in the areas east / north of Hollywood, was therefore mostly constrained to professionals … Continue reading “One way to think about our business”
Category: Development
Off market-deal
Not to beat a dead horse, but: We have a reasonably interesting, off-market 4plex deal that we’re going to send out tomorrow. It’s not going to set anyone’s world on fire, but we think it’s a worthwhile project for someone who likes Silver Lake and is willing to do some work to add value. And … Continue reading “Off market-deal”
3210 Bellevue is sold
We finally sold the last Fund 1 property yesterday and I thought I’d take the opportunity to share the (unaudited, unofficial) numbers: Purchased 5/23/2013 for $690,000 Spent ~$410k renovating (including all fees to Adaptive) So, all in for $1.1MM Took in ~$40k from rents while we owned it Sold 10/9/2014 for $1.42MM Net sale proceeds of ~$1.32MM … Continue reading “3210 Bellevue is sold”
Only in LA…
…would you have huge buildings on Broadway, where studios rent for $4 sq ft, totally vacant above the first floor. Why haven’t the owners used the adaptive re-use ordinance to re-purpose these interesting old buildings as either condos or apartments? Simple: Prop 13. The owners probably bought the buildings a million years ago for pennies, … Continue reading “Only in LA…”
Why we don’t announce closings
If you’re at all active in real estate, your email account is spammed daily by brokers announcing the closings of their latest deals. Why do they do this? Because doing so: Shows everyone in the market how active the broker is Keeps the brokers’ name in front of potential clients, increasing the chances potential clients call … Continue reading “Why we don’t announce closings”
What I do all day
Mostly, it’s underwriting deals. Here’s what happens: Either I find a deal on the MLS, Loopnet, etc. or else a broker or client sends it to me I get my hands on the rent roll (surprisingly hard, sometimes) I look at the property on google maps to get a sense for the location and, critically, … Continue reading “What I do all day”
Good news about our new Highland Park apartment project… and bad news
In our business, you get surprised all the time in ways both great and terrible. Take this new project we’re doing in Highland Park… It turns out there’s a two inch layer of concrete under the floor, meaning we can experiment with doing polished concrete for less than it would cost us to do hardwood. … Continue reading “Good news about our new Highland Park apartment project… and bad news”
Sorry, Westlake, I was wrong
In February of 2012, I wrote a piece confidently predicting that Westlake, the neighborhood roughly south of Silver Lake and Echo Park and west of Downtown, would never gentrify. Here is my piece in all its glory. To lazy to click the link? Here’s my (flawed) argument in a nutshell: The housing stock is incredibly dense, … Continue reading “Sorry, Westlake, I was wrong”
Why NELA
Sometimes clients ask me why we’re so focused on Northeast LA (Silver Lake, Echo Park, Highland Park, etc.). After all, LA is a big place and there are plenty of other places to buy apartment buildings. So why the focus on the hipster areas? Hint: It ain’t because we love asymmetrical haircuts, beards and artisanal pickles. … Continue reading “Why NELA”
Do we compete with our brokerage clients?
In a word, “No”. Why? Because we’re not interested in buying the properties our brokerage clients want to buy. Our typical brokerage assignment is to help someone buy: 2-4 units $500k-1MM 20-25% down (so, looking to put out $100-250k in capital) 70-75% LTV mortgage Minimal renovation required Cashflowing (eg priced at 12x GRM or less) The … Continue reading “Do we compete with our brokerage clients?”