San Pedro apartment tower sells for $80.1 million
The Vue, a prominent San Pedro residential tower completed during the last real estate boom, has been acquired by San Francisco investors for $80.1 million.
Carmel Partners bought the 16-story complex at 5th and Palos Verdes streets from a foreign bank after the lender foreclosed on the developers’ loan, real estate broker Javier Rivera of Jones Lang Lasalle said.
Developers Galaxy Commercial Holding and Carlyle Group intended the Vue to be a condominium building that would offer ocean views at prices first-time home buyers could afford. It was completed at a cost of $175 million in 2008, but by then housing sales were in steep decline and the Vue was soon converted to apartments.
Only 24 of the building’s 318 units were sold, Rivera said, which ended up making the building a desirable investment property in 2011 as real estate investment trusts, money managers and institutions competed to buy the Vue.
“Right now the apartment market is very hot,” Rivera said. “Investors are looking for apartment opportunities at all price and quality levels.”
Southern California apartment rents are still below what they were in the mid-2000s, and investors say they will be able to raise lease rates as the economy improves and unemployment falls.
“We expect rent growth as people decide they will keep their jobs or get one,” he said, and developers are planning new apartment projects throughout the Los Angeles region.
The Vue replaced Pacific Trade Center, an 11-story office building at 255 W. 5th St. that was owned by Beverly Hills landlord and developer Galaxy Commercial Holding.