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5/03/16
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Trion Properties has repositioned and rebranded The Eleanor, a 41-unit 1920’s boutique apartment community in Los Angeles, more than tripling the firm’s equity in the asset since its acquisition in 2013. The Eleanor is located at 412 S. Lake St, north of Wilshire Blvd and just one block west of Alvarado St.
Situated in a gentrifying neighborhood directly west of downtown Los Angeles, the multifamily property was neglected during its prior ownership and was completely vacant upon acquisition, presenting a strong value-add opportunity, according to Max Sharkansky, Managing Partner of Trion Properties. Trion took the asset from zero to 100 percent occupancy within 30 months.
“Urban infill product throughout Los Angeles is making a tremendous comeback due to the lack of developable land available and the upward pressure on rents throughout the region,” explains Sharkansky. “Our overall strategy to identify and reposition ‘diamond in the rough’ assets allowed us to immediately recognize the deep potential in this property and integrate a comprehensive renovation plan that preserved the integrity of its original vintage charm while also significantly driving value for the asset in record time.”
Sharkansky explains that this strategic approach allowed Trion to fully stabilize the asset and drive robust rent growth in just three short years. The property currently commands the highest rent per-square-foot for a 1920’s building in all of the Macarthur Park submarket.
Trion Properties invested approximately $4.4 mil in the asset, including its acquisition and capital upgrades. The firm implemented a vintage art deco style renovation throughout the property’s common areas and interior, replaced all existing systems, and integrated modern amenities.
“Today, the asset is appraised at over $9 mil - more than triple its initial value,” adds Sharkansky. “We recently leveraged this enormous success to refinance the property and cash out all of the initial equity plus an additional 39 percent.”
Continental Funding Group, a Los Angeles-based mortgage banking firm, secured the refinancing on behalf of Trion Properties for a total of $6.1 mil - a 67 percent loan to value. The non-recourse loan was secured at a rate of 3.5 percent for a five year term.
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