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Santa Monica Developer Offers 23 Properties for Sale
By Jorge Casuso
December 23, 2020 -- Santa Monica's biggest residential developer will put 23 proposed projects totaling some 2,100 residential units for sale next month, a source familiar with the offering confirmed Wednesday.
If WSC (formerly WS Communities) finds a buyer for the properties -- all but two of which are entitled -- it would likely be the city's largest real estate deal in modern times, the source said.
WSC, which is headed by Scott Walter, has amassed a portfolio of closely knit properties, most of them Downtown, bought by prominent Westside developr Neil Shekhter over the past 10 years.
The company has been navigating Santa Monica's onerous planning pipeline to got the entitlements needed to build the housing developments.
"Most of the properties are shovel-ready and construction can be completed in about two years," the source said.
Most of the entitled properties -- which total 1,632 units in more than 1 million square feet of residential space -- are closely connected and some pair affordable housing developments offsite, making a portfolio offering more practical, the source said.
The bulk of the properties are between 5th Street and Lincoln Boulevard and Colorado Avenue and Wilshire Boulevard, based on the "Future Projects" list on WSC's website.
Six of the properties offered in the portfolio are market-rate single room occupancy (SRO) developments totaling 361 "micro-units" that must be at least 220 square feet excluding the closet and bathroom.
They received the go ahead in June 2019 under a settlement agreement between the City and WSC that requires 15 percent of the units be affordable to persons earning 80 percent of the median income ("Market Rate SROs Get Go-ahead Under Settlement Agreement," July 1, 2019).
The portfolio also includes a 183-unit project at 3030 Nebraska Avenue, a 140-unit complex at 601 Colorado Avenue, a 134-unit building at 1415 5th Street and 100-unit buildings at 1430 Lincoln Boulevard and 1543 7th Street.
A Walker & Dunlop team headed by Blake Rogers is handling the sale.
According to The Real Deal, an LA real estate news site, Rogers teased the sale on Tuesday morning.
“The Santa Monica Collection: A 2,113 Unit Generational Development Opportunity in Downtown Santa Monica,” Rogers wrote.
A price has not been provided for the portfolio, which will be listed next month, according to The Real Deal.
The website notes that the portfolio "is set to hit the market at a time when L.A. County multifamily deals have plummeted."
Still, a deal would dwarf the 1999 sale of Santa Monica Shores, the 17-story, 532-unit rent-controlled complex facing the beach in Ocean Park.
That deal was considered perhaps the largest real estate transaction in Santa Monica history ("Ocean Park Beach Front Towers Sell for $95 million," May 15, 1999).
The announced sale comes one week after WSC and NMS filed a lawsuit in federal court challenging the City's new restrictions on residential leases ("Apartment Owners Sue City Over Leasing Requirements," December 16, 2020).
The plaintiffs -- which together own the 32 apartment buildings and proposed projects included in the lawsuit -- contend that the ordinance upends their business model.
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