Kensington Does Two Sales Worth $28M; Bascom Buys Pinetree Apartments in Montclair
COMMERCIAL
The Newport Beach office of McCarthy Building Cos. has completed construction on one of its largest projects ever: the $615 million Hollywood & Highland entertainment and retail complex.
The center, located next to the historic Mann’s Chinese Theatre and the Hollywood Walk of Fame, is the boldest move yet to rehabilitate the rundown neighborhood of Hollywood.
In a ribbon-cutting ceremony, film director Rob Reiner spoke about the significance of the project.
For too long, Reiner said, Hollywood had become a state of mind, but this project allows it to once again become a physical place, a destination.
The complex includes 1.3 million square feet of entertainment and retail space and a 1.1 million-square-foot parking structure. Perhaps the crown jewel of the project is the 180,000-square-foot Kodak Theatre, which will become the permanent home to the Academy Awards starting next March.
Hollywood & Highland was one of McCarthy’s most challenging projects, according to project director Greg Schoonover.
“This was a project unlike any McCarthy has ever built,” he said. “The project was built out to the property lines, on top of a working Metropolitan Transportation Authority station, and with no onsite staging.”
The three-year project enlisted 900 construction workers, consumed more than 12,000 tons of structural steel and required the excavation of more than 600,000 cubic yards of material.
According to Schoonover, Hollywood & Highland is “a once-in-a-lifetime project that we can all look back on and take pride in the fact that we played a part in its creation.”
Kensington Flips Two Properties
Tustin-based Kensington Real Estate Group continued its trend of buying, fixing up, then selling properties with its two latest deals: the sale of two retail properties totaling $28 million.
First up, Kensington sold Rolling Ridge Plaza to Passco Real Estate Enterprises Inc. for $13.5 million. Rolling Ridge Plaza is an 85,575-square-foot retail center in Chino Hills. In the second deal, Kensington sold Southridge Plaza, a 121,888-square-foot retail center in Fontana, to Southridge Plaza LLC for $14.5 million.
“Each asset was repositioned during its hold period,” said Patrick Galentine, a principle at Kensington. “The timing and pricing was ideal for the sale of both assets, particularly in light of recent economic news throughout the country.”
In the past four years, Kensington Real Estate Group has acquired and rehabbed more than $150 million of retail, office and industrial property.
Tom Robinson of NTC Commercial, Newport Beach, represented Kensington in the Rolling Ridge Plaza deal. Greg Brown and Ed Hanley of Marcus & Millichap-Newport Beach and Tom Robinson of NTC Commercial represented Kensington in the sale of Southridge Plaza.
RESIDENTIAL
Irvine-based The Bascom Group LLC added to its Inland Empire multifamily portfolio with its acquisition of Pinetree homes, a 165-unit apartment community in Montclair. Bascom acquired the property from Jonathon’s Landing for $14.6 million. Founded in 1996 as a spinoff of its parent company, Chenco International Investment Co. of Las Vegas, Bascom now counts more than 5,500 apartment units acquired in Southern California in the past 36 months.
Bascom said it plans to upgrade the property. Renovations include upgraded landscaping, property repairs, new paint and new signage. Anaheim-based Commercial Services Building Inc. will oversee the rehab project.
Built in 1973, the Pinetree Apartments consists of 22 two-story buildings with two, three and four-bedroom units and an average size of 1,096 square feet. Rents range from $900 to $1,350.
According to Bascom, the property looked like a good investment because of market conditions in Montclair, where apartment occupancy is 98.8% and rents have increased 7.4% in the past year.
Scott McClave, acquisitions director for the Bascom Group, represented the firm in-house. Neil Schimmel of Investors Management Group represented Jonathon’s Landing in the transaction.
Concord Group Sees Downturn
Newport Beach-based The Concord Group has identified economic and political indicators that point to a declining housing market. Concord analyzed the effects of major political and economic shocks to the housing market over time, and found that changes, especially abrupt ones,such as the terrorist attacks on Sept. 11,tend to accelerate the decline of a troubled economy.
According to Concord Group reports, as of summer, the U.S. was experiencing “the most dramatic deceleration of the national economy since the 1974 oil price shock.”
However, the housing market and retail spending both remained solid throughout the summer. But, after Sept. 11, consumer confidence declined to its lowest levels in nearly a decade. As a result, housing markets have experienced declines of 10% to 30% in volume and traffic across the country.
Concord plans to hold a series of roundtable discussions with real estate leaders, including one in Irvine in December.
“We are using this research to structure our strategic planning work with residential developers, the investment community and public sector clients,” said Concord’s Richard M. Gollis. For more information on the Irvine event: (949) 717-6450.
