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July 16, 2005

Club California in Westwood is going condo

More Los Angeles condo-conversion news. Any UCLA alums from the past twenty years would probably recognize the name Club California Apartments, or "Club Cali" as it was more frequently called. This is the apartment complex on Roebling Avenue, right on the cusp of the commercial/retail/restaurant section in Westwood. Well, Club Cali is going condo. The renters (primarily students) have been given their walking papers, and as current leases expire the construction will begin on the individual units. Quick stats: the complex was built in 1973 and has 209 units. Here is some detail on the financing for the project from multihousingnews.com:

Hypo Completes $81M for Condo Acquisition, Conversion

Los Angeles—Hypo Real Estate Capital Corp., the New York-based subsidiary of Hypo Real Estate Bank International, closed on an $80.9 million loan to Westwood Commons LLC for its acquisition and condominium conversion of Club California, a 209-unit apartment development located in this city's Westwood section.

Westwood Commons is a joint venture between Dan Furlan's Construction Rehabilitation Services Inc. and Maisel Presley Inc. Over the past 10 years, each of these two entities, according to Hypo, has built a strong track record in the condo conversion industry.

Built in 1973, the three-story apartment building offers studio, one-bedroom and two-bedroom layouts and an average unit size of 703 square feet. Onsite amenities include an outdoor pool, BBQ area, exercise room, game room and parking garage. The complex is a short walk from UCLA and the heart of Westwood.

"Hypo Real Estate Capital Corp. plans on continuing to expand its leadership position in the condominium-conversion marketplace in California and across the U. S.," said Evan F. Denner, head of real estate finance for Hypo Real Estate Capital.

You can read more about the conversion and its affect on UCLA students at this article from The Daily Bruin, Roebling complex sends off tenants. I think this will be an interesting project to watch. Westwood has been searching for its identity for over a decade now. Does it want to be a real "college town," or does it cater to an older crowd with high-disposable incomes? (The Palomino restaurant, Napa Valley Wine Bar, EuroChow, etc). The Club Cali condo conversion will infuse more disposable income into the area, but the price will be the losing a little of that college feel. If any Bruin Alumni are out there, I'd be curious to see your comment on this project, and if you would consider buying a condo there when they become available.

Los Angeles Apartments
Los Angeles on the Net - www.ultimateLA.com

Posted by ultimatela at July 16, 2005 02:35 PM

Comments

I thinks its great to have more condos out in the LA area. It would of great convenience to the people renting them which work out in the LA area.

Posted by: Apartment Locator Houston at October 27, 2005 08:19 PM

I am a UCLA Alum (class of 2002) and would TOTALLY buy a condo. It's a win-win situation as far as I'm concerned. I can live in a fun, vibrant area as a young professional, and re-live my college days. When I have a family and am ready to buy a house, I'll have made a solid real estate investment, in an area where I will never have to worry about finding tenants. I would rent out to UCLA students -- and I wouldn't gouge them either. Fair market value will cover the mortgage, and in ten years when it's paid off, I'll have a nice source of side income.

Posted by: Julie at November 19, 2005 07:26 PM

I don't know what world this 2002 alumnus is living in, but a quick glance at the price of these units shows a "fair" rent will not even begin to cover the mortgage of any of the condo units being offered. The closet-sized studios are north of $400K and the 2 bedrooms are around $700K. Simple math--even with exotic interest only loans or even negative amortization loans--makes the mortgage payments well north of fair market value rents. Not to mention the almost $300 in association fees every month.
Bottom line: not to be a party-pooper, but even with the best intentions only rarely in Westwood are student-renters not taken advantage of, and as for these condos, they will never be a deal for UCLA students. And if the Los Angeles real estate market has another correction like the early '90s, forget any equity you may have put down on these massively over-priced condos.
By the way, congratulations to the real estate developer who put together the $80 million to buy and rebuild this place. He (or she) will be laughing all the way to the bank after the 200+ units sell for almost double the $80 million that was put in (almost a $100 million in profits, not bad for 10 months work). WOW. You've got to love capitalism.
Greg
(UCLA alumni 2001)

Posted by: greg at March 12, 2006 12:32 PM

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