Tishman Speyer is making a big splash in Santa Monica’s residential market, with a nearly $150 million deal for prime development parcels, The Real Deal has learned.
The New York-based commercial giant is in hard contract for eight fully entitled sites being sold by Neil Shekhter’s WSC Communities, according to sources familiar with the transaction. Tishman Speyer is expected to close on the parcels by year-end.
WSC – controlled by Shekhter, his sons and CEO Scott Walter – had put 23 parcels on the market in January, entitled for the development of over 2,100 units and over 1 million square feet of residential space. “Never has there been an opportunity to acquire a development portfolio of this size in Southern California, never mind Santa Monica,” the marketing materials for the portfolio stated. Santa Monica has a notoriously tight multifamily market, and is known for its challenging entitlement process.
After the Tishman Speyer transaction, which will span about a third of that space and over 600 units, WSC is expected to hold on to the remaining 15 parcels, sources added.
The properties that sold are a mix of office, light manufacturing and small apartment buildings, but all have entitlements to build rental units, records show.
The eight parcels are: 1318 Lincoln Boulevard, 1430 Lincoln Boulevard, 1650 Lincoln Boulevard, 501 Broadway, 711 Colorado Avenue, 1313 6th Street, 1323 5th Street and 1338 5th Street.
A Walker & Dunlop team of Blake Rogers, Javier Rivera, Alexandra Caniglia and Hunter Combs is handling the sale.
Walker & Dunlop declined to comment, as did representatives for WSC. Representatives for Tishman Speyer didn’t comment by press time.
This is Tishman Speyer’s first major residential development play in the Los Angeles area. The firm owns around 2 million square feet of office space across the region, including a 147,000-square-foot office at 2120 Colorado Avenue in Santa Monica.
L.A.’s multifamily market has soared in the last year, recovering from the early days of the pandemic. Vacancies across the Greater Los Angeles region dropped to 3.9 percent in the third quarter of this year, compared to 5.9 percent in the third quarter of 2020, according to Kidder Mathews.