Record Price Negotiated for LA Arts District Land Parcel
Colliers International Represents Famed Hotelier-Developer Jon Blanchard in Record Price per Square Foot Transaction
Famed hotelier and developer Jon Blanchard, the lead developer on the uber-trendy Ace Hotel and other properties, has established a new record for price paid per square foot for unentitled land in the Arts District of Los Angeles after recently selling a 1.2-acre parcel there for $18 million, brokers from Colliers International have reported.
Blanchard, who acquired the industrially zoned site at 1100 E. Fifth Street in June for $15 million, sold it for a $3 million profit approximately 30 days later to Beverly Hills-based investment and development firm Maxxam Properties Inc., which pioneered the re-development of dozens of properties in the downtown region over the past 30 years. Maxxam also owns office buildings, retail centers, industrial properties and residential projects throughout the country.
“After recognizing that he was sitting on a tremendous profit already, Jon decided that he should take advantage of current market conditions and sell for a profit now, rather than take on any unneeded development risk,” said Colliers’ Adam Tischer who, along with Mark Tarcynski, represented the hotel-developer in the transaction. “Plus, the city is currently going through a potential zone change for the area making the future less predictable. With property values skyrocketing throughout downtown, and after the recent sale of the Ace Hotel for $103 million, he decided he could pocket a tidy profit from this parcel and move on to concentrate on his other development projects.”
Tischer noted that Maxxam is in a prodigious position to hold the property while city planners finalize a zoning strategy for the area. The parcel’s central location makes it ideally suited for many potential future uses, including retail, creative office, parking, and more.
“Right now, the only structures on the property are classic warehouses that were used to store spices for the property’s former owner," Tischer added. “A future development will likely see these single-story structures torn down to make way for a higher and better use. It’s a great site for future development and will fit nicely into the Arts District as other properties continue to be developed there. Hopefully, the new city zoning will help facilitate future development so the district can continue to evolve.”