ALL REAL ESTATE INVESTORS LIKE COMMERCIAL PROPERTIES IN 2006
2006 will be a record year for institutional investment in office and industrial real estate. The National Association of Realtors’ third quarter Commercial Real Estate Outlook confirms that large institutions (life insurance companies, pension funds, etc.) – known to be the extremely cautious and risk-adverse with commercial real estate investments – are making a record level of investments in the office and industrial real estate this year. Through the third quarter, institutional investors had purchased a record $12 billion worth of office acquisitions.
Institutional investors and private equity funds have accounted for half of the office building sales, and more than one-third of the industrial property sales volume through the first three quarters of 2006, reveals transaction data from Real Capital Analytics.
"You never want to buy a property where every month you have to feed it," advises investment analyst Neil Binder of Bellmarc Equities.
Unless you’re offering up a big down payment, it’s a challenge to find profitable apartment buildings in the L.A.
716 Vesta St. Inglewood, CA 90302
asking price: 599,000
Those in the know keep saying – it’s an excellent time for apartment building owners.
"Monthly rents have definitely moved up, especially in Los Angeles County, but also in Orange County," declares Delores Conway, director of the Casden Real Estate Economics Forecast for the USC Lusk Center for Real Estate.Rent increases of 6 percent to 7 percent are forecast in Los Angeles and Orange counties in 2006, according to the Casden Forecast. In 2005, the average monthly rent was $1,416 in L.A. County, $1,390 in Orange County. Inland Empire rents, which averaged $1,012 per month at the end of 2005, should rise about 5 percent this year. The Antelope Valley continues to be Los Angeles' most affordable submarket, with 2005 average monthly rents of $916. In contrast, the average rental rate in Newport Beach is $1,892 per month, or about 33 percent higher than the rest of the nation.
"Now that the housing market is cooling and interest rates are moving up, more people are choosing to live in apartments," notes Conway. Additionally,
"Because the housing market has been white-hot and there have been so many condo conversions, the supply of apartments actually went down and the demand went up," Conway observes. "So what we're seeing is tight occupancy, over 97 percent."The national vacancy rate is 5 percent to 6 percent, but as Conway notes. "Anything less than 5 percent is considered full occupancy."
4066 TIVOLI, LOS ANGELES, CA 90066
$799,000
LIVE/WORK SPACE IN MORNINGSIDE PARK
8455 S VAN NESS AVE, INGLEWOOD, CA
NICELY REFURBISHED C2 OFFICE / MEDICAL BUILDING
8453 S VAN NESS AVE, INGLEWOOD, CA
$399,000 – STOREFRONT + BUSINESS
3718 W SLAUSON AVE, LA, CA 90043
MULTI-TENANT AUTOMOTIVE SPECIALTY CENTER
Asking price: $1,195,000
$105,420 annual gross income
SANTA MONICA SLUMLORD'S PROPERTY GETS DEMOLISHED
City of Santa Monica v. Gonzalez, 45 Cal.Rptr.3d 84.
Court steps in to abate a public nuisance beyond repair
--by Bob Bruss
Beginning in 1989, apartment building owner Guillermo Gonzalez was repeatedly cited by city building inspectors for unsafe and unsanitary conditions in the property where he and his family reside in one of the three units.
In 1990 the court issued a default judgment to demolish certain outbuildings, which were built without permits. The $21,940 demolition cost was recorded as a lien against Gonzalez's property title.
In 1997, the city filed an 85-count misdemeanor criminal complaint against Gonzalez, alleging violations of the building, fire, housing, plumbing and electrical codes. He was found guilty of 15 of the counts and ordered by the court to correct all code violations within 30 days. However, he failed to correct the violations and was sentenced to 30 days in jail.
In 1998, Gonzalez served an additional 90 days in jail and was later sentenced to 450 days in jail for continuing violations.
In 2001, city inspectors returned to the property and found 32 misdemeanor code violations. Finally, on Dec. 6, 2004, the city petitioned the court for appointment of a receiver to take control of the property, which had become a public nuisance. The court appointed the receiver. He found in a single bedroom on the second floor 14 bunk beds where tenants paid to sleep. The
front yard had been converted to a makeshift kitchen and the back yard was filled with inoperable vehicles.
HOMELESS STATISTICS
The 2005 Greater Los Angeles Homeless Count, conducted by the Los Angeles Homeless Services Authority (LAHSA) in January 2005. LAHSA estimates that there are 88,345 homeless persons throughout the County of Los Angeles on any given night. At that time, LAHSA directly counted 1,192 homeless persons in Santa Monica shelters or on the street.
Surveys were conducted on the streets and in shelters in the days following the nighttime count. The findings were used to estimate the number of persons who experience homeless annually throughout the County – 221,363.
The Westside falls under the County’s Service Planning
