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Santee Village Lofts Set to Hit the Market for a Second Time

By Eric Richardson
Published: Wednesday, February 16, 2011, at 03:39PM
Santee Village Lofts Eric Richardson

Model unit inside the Santee Village Lofts, which reopens for sales this month.

Will the second time around be better than the first for the Santee Village Lofts? New owner Kennedy Wilson believes so, betting that attractive pricing will be just the ticket to bring buyers to the Los Angeles Street condominium project.

The company bought Santee Village's 167 unsold condo units from Bank of America in November, and next week it puts the first 19 of them back on the market.

First opened in 2004, the seven-building complex occupies much of the block bounded by Los Angeles, 7th, Maple and 8th Streets. The $130-million project by developer MJW Investments included 445 units, both rental and for-sale.

Sluggish sales on the condo units led MJW to default on a construction loan in 2008, and the project eventually would up in the hands of Bank of America.

Stephen Henry, Managing Director of Acquisitions for Kennedy Wilson, believes it was timing and pricing that doomed an otherwise well-thought-out project.

"I think this project was really a creatively conceived project," Henry explained. "MJW Investments really had a vision for this, and I think it's one of the most unique communities Downtown. We just hope to highlight that."

While most Downtown residential projects have come online as rentals over the past two years, Henry believes that the condo market is there for product that is priced correctly.

"It really comes down to pricing," he said. "I think you need to figure out where the pricing is in the market and you need to price accordingly. I think that there's still strong demand for affordable residential housing in Los Angeles, without a doubt."

The first group of 19 units that the company will be offering for sale are located in the Eckardt Building and range from $199,000 to $670,000, averaging around $280 per square foot.

"The thing we're most excited about is that in the Eckardt Building, 33 of the 36 units we have are priced in the $200,000's or below," Henry said.

While the company isn't making any major changes to the project, it is working with Essex Property Trust—owner of the project's apartment units—on some upgrades to shared amenities.

Don't expect to see any auctions at Santee Village. While Kennedy Wilson is best known Downtown for sales it conducted at Market Lofts and 655 Hope, that part of the company's operations are conducted by a separate services group.

The Beverly Hills-based company actually has a much longer history Downtown. In 2001, Kennedy Wilson partnered with Kor Group on the adaptive reuse conversion of Standard Oil's former headquarters into the Pegasus apartments.

"We're always looking for new properties and new communities in our backyard," Henry said. With the purchase of Santee Village, "we were excited to get back to Downtown."


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