Prime Residential Buys More Miracle Mile Apartments

Prime Residential just plunked down more than $50 million for an apartment complex near Los Angeles’ Museum Row.

The San Francisco-based multifamily owner and operator acquired the 134-unit Palm Court Apartments at 740 South Burnside Avenue for $51.3 million, or roughly $388,000 per unit, Commercial Observer reported. An affiliate of Studio City-based Harrison Properties was the seller. Marcus & Millichap’s Jeff Louks, Gayle Factor and Elliot Sabag represented the seller, while Marcus & Millichap’s Matt Ziegler brought the buyer.

Harrison Properties recently completed wide-reaching renovations on the complex, Ziegler told Commercial Observer. The property was completed in 1988 with 48 one-bedroom units, 72 two-bedrooms and 12 three-bedrooms. Amenities include a pool and spa, a fitness center, saunas and a rooftop deck.

The purchase deepens Prime Residential’s roots in the area. The company has owned the Park La Brea residential community, said to be the largest apartment complex west of the Mississippi River, since 1995. That property has 4,249 rent-controlled units in 18 high-rise towers and 175 garden-style buildings across 144 acres.

Multifamily investment in Los Angeles is ticking upward, with transactions like Prime Residential’s latest purchase adding to the growing number of properties that have traded hands over the past year.

Investment sales in Greater Los Angeles in the 12-month period ending in March were up 25 percent from the previous 12-month period, according to Marcus & Millichap data cited by Commercial Observer. Los Angeles itself accounted for more than 20 percent of all apartment sales in major U.S. markets in the 12-month period.

At the same time, some investors are wary of sinking their teeth into the local market because of the polarizing Measure ULA transfer tax. Transactions exceeding $10 million in the same year-long period were down 50 percent compared to the year before the measure went into effect in 2023.

Multifamily vacancy in Los Angeles was at 4.8 percent at the top of this year while average rents rose 1.4 percent since the same time last year. Vacancy is expected to creep up to 5 percent by the end of this year as 8,500 units are added to the city’s housing stock, according to Marcus & Millichap forecasts.

— Chris Malone Méndez