Creative Artists Agency co-founder Michael Ovitz and his wife Judy have sold an apartment complex in Long Beach for about 10 percent less than they paid for it in 2017, The Real Deal had learned.
Irvine-based investment firm Advanced Real Estate bought the 156-unit Edison at 100 Long Beach Boulevard, according to an announcement this week. Cushman & Wakefield’s Marc Renard represented both the buyer and the seller in the deal.
Advanced declined to name the seller or the price, but county records show it was sold by a limited liability company linked to the Ovitz family for $58 million.
The Ovitz family bought the complex in 2017 for $65.4 million, records show, with Michael and Judy both signing mortgage documents from Bank of America for the property in 2019.
Though office buildings have been trading at lower valuations than prices five years ago, few apartment complexes across the L.A. region have traded at a loss, as rent growth has slowed but remains generally positive. However, if they hold floating rate debt, apartment owners need to keep up rental rates at the same pace as rising interest rates in order to service their loans.
Rents in Long Beach averaged $1,795 a month in April for a one-bedroom unit — a zero percent change from April of last year, according to Zumper.
Built in 1960, the building was formerly an office building that served as the headquarters for the Edison Company. In 2016, the property was converted into 156 residential units by then-owner Waterton Residential, a landlord based in Chicago.
Office-to-residential conversions are difficult for any owner to pursue, given the economic, design and logistical challenges. Some office owners have pushed for it, given persistently high vacancy rates across the office market, but deals are difficult to pencil out financially.
Ovitz was a Hollywood talent agent who co-founded Creative Artists Agency in 1975 and served as chairman until 1995.