Westwood land sales saw very little activity in 2014 and 2015, and 2016 is shaping up to offer more of the same.
The issue seems to be one of volume rather than interest. This established neighborhood historically offers few lots for sale. When lots do come up, they’re likely to require tear-downs — and even those are few and far between.
According to data provided by JLL, 2014 didn’t see any vacant land sales in Westwood. In 2015, a single .3-acre plot came up for sale at 2100 Westwood Boulevard. The property included a 3,640-square-foot automotive repair facility built in the 1960s. In January 2015, ownership of the property was transferred via a grant deed, most likely as part of a family succession plan, for an undisclosed amount.
During the first quarter and midway through the second quarter of 2016, there was an absence of land sales and only a single offering: a 3-acre plot at 1218 Glendon Avenue near the entrance to a cemetery where buyers are invited to “spend eternity with A-list stars.”
A collective look at the smattering of land transactions during the last 25 years shows a total dollar volume of $292 million with an average sale price of $276 per square foot, according to data provided by JLL.
The last time land sales showed any significant kind of movement was 2013, when consecutive quarters ranged in the millions and reached nearly $17 million in total land sales for the year, according to data provided by JLL. In Q3 2013 alone, the total dollar volume was $7 million with the sale of a 14,373-square-foot development site at 880 South Devon Avenue in the heart of the Wilshire-Westwood scenic corridor, dubbed Golden Mile.
The Devon Avenue property was entitled for 19 residential units in an area where apartment rents exceed $10,000 a month. As the property went up for sale, owner Robert Margolis requested an increase in entitled residential units. The property was purchased by HSW Management and in July 2015, the Westwood Community Design Review Board completed a final review for construction of an 82-foot-high, seven-story, 32-unit residential building over three levels of subterranean parking with access off Devon Avenue. But with a construction launch still pending, the property has been intermittently serving as a Christmas tree lot.
The six transactions in 2013 that turned over ownership of a collective 1.23 acres had a significant effect on Westwood’s small submarket, rocketing the average price per square foot from $116 in the second quarter of 2012 to north of $500 per square foot in 2013.
The 2013 uptick, however, was brief. It was immediately followed by a land price softening that lowered sales totals for the next several consecutive quarters. Prices then held steady in 2014 and 2015 as land sales slowed to a halt.
The lack of volume in recent years is partially because it’s a tight market, says David Berg of Partners Trust, a Beverly Hill-based firm with several active listings in the Westwood market.
“I can’t imagine there are more than 1,500 homes in this submarket, so any sales will make a ripple,” Berg told The Real Deal.
Market conditions aren’t surprising, given the fact that Westwood already has one of the highest population densities in L.A. County, averaging more than 13,000 people per square mile. It’s also one of L.A.’s youngest submarkets, with a median age of 27, thanks in part to it being the home of UCLA.