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Winstar buys 79-unit Hollywood apartment complex
Purchase for $27.5M represents 28% discount from seller Cypress’ previous deal
Even in a multifamily market hobbled by Measure ULA taxes and high interest rates, deals still find their way to closing day.
Austin-based Cypress Real Estate Advisors defied unfavorable market conditions to sell the MetWest on Sunset, a 79-unit apartment complex on Sunset Boulevard in Hollywood, The Real Deal has learned.
The deal for the 70,800-square-foot asset, located at 5837 West Sunset Boulevard, closed Sept. 22, according to a deed filed with the Los Angeles County Registrar’s Office. The buyer is residential landlord Winstar Properties. The firm paid $27.5 million for the asset, according to a calculation of transfer taxes paid in the deal. Winstar is funding the acquisition with a $17.5 million loan from Israel Discount Bank of New York.
Cypress bought the six-story property for $38 million in April 2019, meaning its sale last month represents a loss of $10.5 million, or nearly 28 percent.
The purchase in 2019 was Cypress’ first acquisition in California, according to a previous report by TRD. The company’s portfolio consists of multifamily complexes in Texas, Colorado and North Carolina.
Winstar, which is headed by Jonathan Wintner and Alan Stern, describes itself as a firm with a “long-term investment approach.” According to a 2020 report from Knock-LA, the firm owns and manages 276 rental properties across Los Angeles County. The portfolio includes properties in Koreatown, East Hollywood and Jefferson Park, its website shows. Prominent properties are the Asbury Apartments, a 13-story, 99-unit rent-controlled apartment complex in MacArthur Park and 160 South Gramercy Place, a 39-unit residential complex in Koreatown.
The transaction is an anomaly in Los Angeles’ floundering multifamily market. According to a report from NAI Capital, sales of apartment complexes in the city fell by nearly 49 percent in the first half of the year. The decline was more pronounced with the upper tier of the market. During the period, sales of apartment buildings over $5 million dropped by 75.2 percent.