California Landmark Group aims to develop 112 units on a corner lot in Palms at the border of Culver City.
The firm filed plans with the Los Angeles Department of City Planning last week.
California Landmark would erect the building at the corner of West Washington Boulevard and Motor Avenue, now home to a low-rise commercial building. The new building would connect to an existing 33-unit apartment complex.
The firm plans to utilize entitlements through the city’s Transit Oriented Communities program, which allows developers to choose from a suite of incentives, such as increases in floor-area ratio, in exchange for offering a percentage of units below market rate.
The project would have 15 affordable units, or roughly 10 percent of the 112 new and 33 existing units. The new development would also have 2,000 square feet of commercial space.
California Landmark’s Ari Kahan said the firm plans to secure construction financing after receiving construction permits.
Canfield Development’s Steve Erdman and Metro Properties’ Rodney Freeman are listed as signatories on documents related to a $6.8 million loan taken out on the existing building in February. Kahan said the loan was not related to the new development.
Palms is getting a lot of attention from developers because of its proximity to Culver City, which lacks an incentives program like TOC.
Kahan said the firm has developed a handful of new apartment buildings around Culver City and that California Landmark was “very bullish” on it.
“There’s plenty of job growth in the area and not a ton of housing in Culver City, so we’ve found that [providing] that supply for that area, we can do pretty well with the community and everyone involved,” he said.
California Landmark has moved forward with projects since the start of the coronavirus pandemic, but has not purchased any properties during that time. Kahan said that sellers — of land in particular — are beginning to lower their prices, but that there is “a long way to go” before the firm starts buying again.
He said that sellers are taking cuts up to 10 percent, but most developers are seeking up to 20 percent discounts. That could take a while, he said.
“Real estate doesn’t track like the stock market — it took a year or so before foreclosures ramped up last time,” he said, referring to the financial crisis. “When people start feeling that distress is when there will start being deals out there.”
Last year the firm filed plans to add nine units to its 68-unit R3 Lofts condominium building in Del Rey.