|
|
|
|
|
|
The MET WARNER CENTER
Los Angeles, CA
Fee managed for preferred equity and mezzanine lender
SITUATION:
A 1,279-unit, 1980’s era apartment community comprised of 16 three-story buildings was acquired by a condominium converter; all units were emptied, renovated in the same color palette and offered for sales; sales stalled, the homeowners were unhappy and property management was overwhelmed; the project has no sales for months and the mezz lender and preferred equity lender asked RADCO to take over; securitized debt made transfer and amendments to business plan difficult. This was one of the largest condo projects to fail in the county, with $230m in condos remaining to be sold.
THE PLAN:
RDS repositioned the property to better appeal to its main demographic-the first-time homebuyer; the club house, fitness center, pools and models were redone with this market in mind; sales materials was created to excite the newly defined market; the sales team was required to “hunt” and the “order taking” mindset was eschewed; RDS made construction improvements including the main entry gate and security access system, signage and landscaping; make the HOA relevant.
RESULTS:
Even in the 2009 housing market, The MET ended the year with 27.3% market share in Los Angeles County (11/09, Buildermetrics) and 69 closings in the fourth quarter; traffic throughout the year more than doubled. Between January and April 2010, The Met has sold another 63 units and continues to lead sales in L.A. County. Homeowners remain pleased with the project and are the best salespeople; project repayment of the mezz debt in full.
