Rising Realty’s new CEO plans to invest $300M in properties outside LA

Christopher Rising, who just took helm from his father, will also focus on environmental impact

Jan.January 31, 2019 05:06 PM
Chris Rising, Nelson Rising, and One California Plaza (Credit: Getty Images and Wikipedia)

Rising Realty Partners plans to invest more than $300 million in properties in the Western U.S. over the next two to three years, with an emphasis on cities outside of Los Angeles.

Christopher Rising, the company’s newly named CEO, said the L.A.-based firm will focus on acquiring commercial mixed-use properties in new markets, including Salt Lake City, Denver, Portland, Oregon, and Seattle.

Rising is taking the reins from his father, Nelson Rising, who will continue to serve as chairman.

Rising Realty, which has played a large role in helping shape Downtown’s development in recent years, has about $1.3 billion in assets under management across 4.3 million square feet, all of it in Southern California.

“This is going to be a defining year for Rising, which is one of the reasons we made the transition,” he said.

As part of the new business plan, Rising Realty plans to chart its progress in improving the environmental quality of the commercial buildings it acquires and adapts for other uses. That includes measuring the air and water quality, and a building’s carbon footprint.

“We believe there are more and more investors that care about this,” Rising said. “We also believe nobody else is doing it.”

Rising said that tenants seeking to acquire larger spaces also will be willing to pay higher rents for such transparency and reporting.

“They want to know they are in a building where the water is not killing them, or the air is not killing them, where the asbestos has been removed and the lead paint has been removed.”

Rising said that the company will report the environmental metrics side by side with its other investment financials in all of its investments under the new business plan.

The company announced on Wednesday that Christopher Rising would be taking over as CEO. A former lawyer, Rising, 49, joined with his father in 2011 to relaunch their namesake firm. Nelson Rising was a developer of U.S. Bank Tower and formerly chaired the Federal Reserve Bank of San Francisco.

At Rising Realty, the father-son duo have focused on adaptive reuse and repositioning of large commercial buildings, many of them with challenging historical features.

The elder Rising will continue to chair the firm’s investment committee and focus on raising funds and the closing of larger deals, his son said.

The newly minted CEO said Rising Realty’s push for deals outside of its home base did not reflect concerns about the state of the real estate cycle in Downtown or elsewhere in Southern California, where sales are slowing broadly.

“I don’t think you can play the cycles in value-added real estate,” he said. “These are really three-to-five year business plans after we acquire these properties.”

More than half of Rising Realty’s property space — 2.6 million square feet — is in Downtown L.A.

The firm is best known for purchasing the historic PacMutual building for $60 million, spending $25 million to renovate it and then selling it for $200 million in 2015, a record Downtown sale at the time.

In 2017 Rising Realty joined with Colony NorthStar to buy One California Plaza for $460 million. GreenOak Real Estate Advisors recently partnered with Rising Realty in a $111 million recapitalization of the CalEdison building, which the firm has been repositioning for creative office space.

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