Today, I want to talk about windows. Still here? Good. Windows are a controversial part of the repositioning process. Replacing them is pretty expensive (on the order to $400-500 / window) and, while new windows open / close easily and look nice, no one ever rented an apartment because of the windows. Still, we intend … Continue reading “Some thoughts on windows (zzzzz….)”
Category: Development
A tough loss
Just lost out on a deal that I wanted to do, despite being the highest bidder. So, how did I lose? Well, this was a development deal. And the land was super-hilly. So I wanted to have five days to get a geologist, an engineer and an architect out to take a look at the site … Continue reading “A tough loss”
The rebirth of rooming houses?
Today’s Wall Street Journal has an interesting article [subscription required] on the re-birth of boarding houses [h/t to Manoj]. Back around the turn of the 20th century, as immigrants flooded into major cities, developers built rooming houses where you could rent very small accommodations, often with share bathrooms. Eventually, zoning codes halted the construction of this … Continue reading “The rebirth of rooming houses?”
363 S Leslie Way is done
We just entered lease-up on a fourplex we renovated at 363 S Leslie Way in Highland Park. Embarrassingly, we had to put the breaks on leasing this weekend, because we leased two of the units in about two minutes and realized we were underpriced. (This is a high class problem!) Anyway, here are some amateur … Continue reading “363 S Leslie Way is done”
A savvy deal I couldn’t do
Just got a flyer from a reasonably active local broker announcing a deal he closed with the following characteristics: In Westlake, a rapidly improving neighborhood situation between Koreantown and Downtown 10 units totaling 9,800 sq ft 15,000+ sq ft lot R4 zoning $1.8MM price The flyer didn’t specify the rents, but, as I recall, the … Continue reading “A savvy deal I couldn’t do”
One way the Fire Department raises rents in LA
Today, I want to talk about one of the unacknowledged factors driving up the cost of housing in LA: The fire code. Now, it’s obvious why we need the Fire Department to weigh in on the design of new buildings. The department is going to have to rescue the inhabitants in the event of a fire and it obviously … Continue reading “One way the Fire Department raises rents in LA”
Thinking about the path not taken
Recently, I’ve been doing a lot of thinking about where we are in the cycle, debt, risk and asset allocation. You see, many of my contemporaries have been doing fairly high-leverage development deals and doing very well with them. We at Adaptive have shied away from those sorts of deals, for two, related reasons: You … Continue reading “Thinking about the path not taken”
When to start lease-up on a rehabbed building?
Here’s a question we wrestle with all the time: When should lease-up begin? You’d think this would have an easy answer: When construction is done. But you’d be wrong. Usually, buildings are “showable” (eg look pretty close to complete) 2-4 weeks before the construction is actually done. And, after carrying the building with no cashflow … Continue reading “When to start lease-up on a rehabbed building?”
One lesson from our foray into ground-up construction
We’re closing today on what will become either our second or third ground-up project (depending on how you want to count this one). In going through the design / permitting process, I’ve already learned a pretty valuable lesson, which I’ll share here. I always wondered why investors wanted to see a higher pro forma yield on … Continue reading “One lesson from our foray into ground-up construction”
We’re a little bit different
Had an interesting tour yesterday of a building we probably won’t buy. The reason it was interesting is that we were reminded, yet again, of how differently we look at acquisition targets. The broker began to give us a whole spiel about how many of the units had been renovated, what the rents were, how … Continue reading “We’re a little bit different”