An East Coast developer is building its first West Coast project in North Hollywood with the help of several local companies and investors. Peak Finance, a division of the national real estate service company Peak Corporate Network in Woodland Hills, secured nearly $103 million to help finance the project, called the L+O Residences. The complex will include 297 apartments above a new 365 by Whole Foods Market at Lankershim Boulevard and Otsego Street in the NoHo Arts District. Michael Katz, senior managing director, also found a partner for the project’s East Coast developer, Camden Securities Co. of White Plains, N.Y., in his 25-year client, Donald Hayes, owner of Hayes Capital Management of Woodland Hills, which owns and manages apartments and retail spaces. Katz matched Hayes with Camden, which owns the property. Camden develops throughout the U.S. and wanted to start developing in California, Katz said, so he connected the two companies. “It’s good to have local experience when coming out to the West Coast,” he explained. Another local partner in the joint venture is Patrick Ayau, a commercial real estate broker with Lee & Associates West L.A. Ayau arranged the initial sale of 38,500 square feet of older office and flex buildings to Camden in 2015 that were demolished to build L+O Residences. Finally, Katz found another local investor in the deal in Canyon Partners Real Estate, the real estate direct investing arm of L.A. investment firm Canyon Partners. It contributed $32 million of preferred equity to the financing bundle that Peak Finance arranged. The additional financing Peak secured supplements a $70.5 million construction loan from the Bank of the Ozarks in Little Rock, Ark. The apartment project is estimated to cost $125 million, Katz said, with Camden providing the outstanding amount. Pulling the deal together took Peak Finance two years, Katz said, and was challenging because of its uncommonly large size. Banks are providing smaller loans for large construction projects these days, Katz said, because they want less risk. “That was one of the reasons we ended up with two separate lenders,” Katz said. “The bank was very comfortable with the developer, and very happy with Canyon.” Katz said the project is expected to finish by the end of 2018. Developing Treeland The large tract of land surrounding the 65-year-old Boething Treeland Farms Nursery Inc. in Woodland Hills could be replaced by a residential community and assisted living facility. Bruce Edgar Pherson Jr., president of the business and son-in-law of the late John Boething, who co-founded the wholesale nursery, has submitted the concept to the city of Los Angeles for approval. Called Treeland Homes, the development is envisioned for 23475 and 23485 Long Valley Road at its intersection with Valley Circle Boulevard and north of the 101 freeway. The 32-acre site property also includes a sliver of land across Valley Circle Boulevard. Pherson’s plan would see an 87-bed, 60,500-square-foot assisted living and memory care facility, 121 homes and about 22 acres of open space. But the large tract is rife with challenges, according to the study’s authors. There are multiple zones and land uses, such as agricultural, commercial, residential and open spaces. As a result, the applicant needs to change the zoning to commercial from residential for the eldercare facility, and the current type of residential zoning to another type for the planned housing types, as some of the required amendments. Additionally, the nearly four-story small-lot homes require an exemption from the local building height standards; the retaining walls require approval from the city’s Zoning Administrator; Pherson is asking to be exempted from improving a section along Long Valley Road; and the parcel is a wildfire hazard area, according to the study. On the upside, the nursery parcel is in a hub of public transportation, with bus service to and from the Warner Center, the West Hills Medical Center and the Van Nuys Airport. The city held a public meeting in June. Pherson did not return calls for comment. Burbank Rents Increasing apartment rents in Burbank have outpaced California and the rest of the country, according to Apartment List, a rental marketplace in San Francisco. Rents in Burbank have soared more than 6 percent in July from the same month last year. Statewide, rents rose 4.2 percent and less than 3 percent nationwide. Median rents are at $1,530 for a one-bedroom and $1,970 for a two-bedroom, according to the report. While they slipped in January, rates have risen steadily since then. Rents are higher elsewhere. A two-bedroom abode in Pasadena is more than $2,000 and $2,470 in Santa Clarita, according to the report. Apartment List extrapolates median rent increases from data from the Census Bureau. Staff Reporter Carol Lawrence can be reached at (818) 316-3123 or [email protected].
