LA wants to fund another 3K affordable units with bond money, rents rising nearly twice rate of inflation: Daily digest

A daily round up of LA real estate news, deals and more for September 19, 2019

TRD LOS ANGELES /
Sep.September 19, 2019 03:30 PM

Every day, The Real Deal rounds up Los Angeles’ biggest real estate news. We update this page in real time, starting at 9 a.m. PT. Please send any tips or deals to [email protected]

This page was last updated at 3:30 p.m. PT
 

LA officials want to set aside $335M to build another 3,000 affordable units. The funding would come from Measure HHH, a $1.2 billion bond that voters approved in 2016. If approved by City Council, the total number of HHH-funded units in the pipeline would rise to 8,625 — 6,858 of which are “supportive” with on-site services. [Curbed]

 

Rent in LA is growing nearly twice the rate of inflation. Rents in L.A. and Orange counties are growing at 5.5 percent annually, according to U.S. Bureau of Labor. That’s the highest it’s been since 2007, and nearly double the 3 percent inflation in the area. [CO]

 

Banks seek to revise Adam Neumann’s $500 million credit line. Following a cool reception from investors over his company’s valuation, lenders are looking to revise the terms of the WeWork CEO’s credit line — of which he’s drawn $380 million from. The exact changes to the credit line were not immediately apparent. [Bloomberg]

 

Airbnb’s war with NYC deepens as it heads toward an IPO. The startup’s aggressive tactics have backfired in New York as the city continues to wage a muscular crackdown on illegal operations. [Bloomberg]

 

Profits on home flips are declining. Buyers flipped 59,876 single-family homes and condos in the second quarter, down from 5 percent a year ago. Profits decreased as well, with the average return on investment hitting 39.9 percent last quarter, down from 44.4 percent. [CNBC]

 

Blackstone slides into massive purchase for waterpark operator. The deal to buy Great Wolf Resorts Inc. from New York-based Centerbridge Partners would Great Wolf at around $2.9 billion, including debt. Centerbridge bought Chicago-based Great Wolf in 2015 and the operator has since added six resorts to its portfolio — including Great Wolf Lodge in Garden Grove — bringing its total to 17. [Bloomberg]

 

Developer City Century’s plan for freeway-facing balconies at its Olympia residential project is back on the table. The firm won its appeal of a Planning Commission decision that said the 110 Freeway posed health concerns to residents with balconies facing the roadway. City Century also won an appeal over its plan to build digital signage facing the highway. The full City Council must now must give its approval. [Curbed]

 

Details surface for hotel conversion of LA’s first skyscraper. Chicago-based developer Rebel Hospitality wants to turn the Continental Hotel, built in 1903, into a 140-room hotel with 16,900 square feet of food and beverage space. That includes a basement bar, a ground-floor restaurant, a 12th floor bar with bowling lanes, and a rooftop patio. [Urbanize]

 

Gov. Gavin Newsom signs “gig economy” law with real estate agent exemption. The law will likely reclassify thousands of laborers from independent contractors to employees. It was designed to address labor issues in the “gig economy,” such as drivers for ride-hailing services such as Uber and Lyft. An exemption for real estate agents was added just before it cleared the state legislature, assuaging concerns in the industry. [LAT]

 
The home on Tower Road. (credit: Redfin)
The home on Tower Road. (credit: Redfin)

Beverly Hills home with Hollywood pedigree hits market again. Just two years after the 85-year-old home on Tower Road sold for $25 million, it’s back on the market. This time it’s being offered for $32.5 million. The 15,300-square-foot home was once owned by former MGM executive L.K. Sidney, and “The Terminator” producer Gale Anne Hurd. [Redfin]

 

FROM THE CITY’S RECORDS:

A developer wants to build a 120-unit mixed-use residential complex at 111 N. Harbor Boulevard in San Pedro. 11 of the units in the six-story development would be set aside for “extremely low-income” renters. [LADCP]

 

Compass is expanding in the West Coast. As its legal battle with Realogy continues to play out, Compass has announced a new technology center in Seattle, which the SoftBank-backed firm hopes will help to attract new talent. [Inman]

 

IBM is suing Zillow. A new lawsuit filed in California this week accuses Zillow of multiple charges of patent infringement over its computer programs. A Zillow rep said the claims were “without merit.” [Inman]

Federal Reserve Chairman Jerome Powell (Credit: Getty Images)
Federal Reserve Chairman Jerome Powell (Credit: Getty Images)
 

The Fed has cut rates again. The announcement signals to commercial real estate investors that the bank is proceeding with caution. [TRD]

 

Deals for WeWork buildings in London are in strife as IPO woes deepen. A Saudi Arabian buyer has pulled out of a $112 million deal for a WeWork building, with sources citing concern over the startup’s public offering in the U.S. Meanwhile talks to sell WeWork Waterloo, branded as the largest co-working space in the world, have stalled. [Bloomberg]


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