In 2013, Jamison Services had to decide what to do with an aging office building on the edge of Koreatown, where the anchor tenant was moving out.
The real estate firm, which had built its business on acquiring commercial properties, could rehabilitate the property in the gentrifying Wilshire Boulevard neighborhood and hope to lure another anchor tenant. Or it could try something new: remodel the nine-story property as an adaptive reuse and meet the growing demand for new residential construction in housing-strapped Los Angeles.
That November, Jamison opened the 127-unit Westmore apartment, outfitting the modestly-priced rental with a fitness center, media room, sauna and lounge bar. “We leased it up in less than three months,” said Jaime Lee, CEO of Jamison Realty and executive vice president of Jamison Services.
“The Westmore really showed us that there is a great desire for additional multifamily in Koreatown, but also of a different type,” she said. Renters were responding to features such as on-site parking and wifi throughout, amenities that had been scarce in the neighborhood.
That project opened the floodgates for Jamison to break into the multifamily space, where it has become one of Koreatown’s dominant players. Guided by the charismatic Jaime and her press-shy father and Jamison founder Dr. David Lee, the firm has become a leader in converting commercial space into multifamily developments. It now has 14 such projects in its portfolio under construction, the bulk of those within the narrow confines of Koreatown.
Lee, an internal medicine practitioner from Seoul, South Korea, first invested in Koreatown in the 1990s. At that time, the neighborhood was still reeling from the L.A. riots, and the economy was pulling itself out of a downturn.
“All the developers fled to suburbia and we came in,” said Jaime, 33. Back then, she said, Jamison provided a rare opportunity for small business owners or two-person law firms to “come in and get office space, even if they were immigrants and didn’t have credit.”
In recent years, David’s children — Garrett, Philip, Jaime and Brian — have taken on leadership roles and opened the company up to the press. Their mother, Dr. Miki Nam, runs accounting for the company. Jaime, as the CEO, has become the public face of the company.
Jamison now has an estimated portfolio of 18 million square feet, valued at $5 billion, according to Real Capital Analytics. It acquired at least 10 properties in the past two years, and now manages and leases more than 100 commercial buildings in L.A.
The company’s bets are now being closely followed by some of the industry’s blue-chip players. Brookfield Office Properties, for example, bought a controlling stake in Jamison’s California Market Center in June, in a deal that valued the property at $440 million. Jamison paid $135 million for the 1.8 million-square-foot apparel showroom in 2005.
But Jamison’s success has not come without its critics. They have accused the family-run business of being absentee landlords, of keeping rents low and occupancy high by failing to renovate buildings or maintain facilities.
“One of the knocks about Jamison over the years has always been the quality of maintenance of buildings,” said Jay Chu, a founding partner of Secured Properties, and a longtime family acquaintance. “My office is in one of those buildings — I know firsthand,” he said.
Chris Rising, founder and president of Rising Realty Partners, said, “if a tenant decides to sign a lease in a Dr. Lee [building], they’re going to have a tenant experience that is different than a Rising or Brookfield building.” But he acknowledged, “there’s a whole market out there for people who don’t really want to pay a lot of rent.”
When asked about this perception of Jamison, Jaime replied: “We’ve never put ourselves out as Class A office market.”
Newmark Knight Frank’s Kevin Shannon, one of the top investment-sales brokers on the West Coast, said David’s “reputation, as far as doing what he says, is outstanding.” The company founder, Shannon added, is “one of the easiest guys on the contract, and he always performed.” Jaime’s emergence, he added, has also been “very well-received” in the industry.
Cresa’s Marc Bretter, who represented Concept Arts in its full-floor lease there, said the deal attracted the attention of other brokers on the lookout for their clients. Jamison “made the deal really compelling,” he said, “and did everything they said they were going to do, finishing the renovations even before we signed the deal.”
Jamison is still primarily a commercial owner and operator. Multifamily investment, however, has increasingly become a part of its gameplan.
The firm has more than a half-dozen residential projects in the pipeline for Wilshire Boulevard alone, all in Koreatown. Nearing completion are 3640 Wilshire, a 209-unit residence with 3,100 square feet of ground-floor retail; and 3345 Wilshire Boulevard, a 202-unit adaptive reuse project with room for community space, among others.
Projects outside the neighborhood include the firm’s biggest undertaking, the $500 million Circa, which will deliver 648 units across two Downtown towers later this year.
Jaime declined to comment on projects not yet out the ground. But she said the company will seek to utilize the city’s new transit oriented communities law to seek density bonuses for taller apartments with more units.
“We’re seeing not only a tremendous increase in the interest in Koreatown and our Mid-City location, but this really pressing need for housing.” Lee said. “It’s ideally situated and its really undergoing a renaissance right now.”
Lee said Jamison’s massive commercial portfolio gives the company lots of options for residential conversions.
“We know that what we’re building will continue to sustain throughout any downturn and we have flexibility to that extent,” she said. “We’re very nimble in that we can react very quickly to what’s going on in the market.”