A full city block in the heart of Los Angeles has hit the market in what property professionals are calling a rare redevelopment opportunity for a sleepy stretch of outdated buildings in an affluent area.
A local family office is seeking the best offer with a swift closing on an unpriced, 0.65-acre parcel on Beverly Boulevard between Beverly Hills and West Hollywood, according to Avison Young Principal Eric Moore, who is helping market the property. The site includes 27,129 square feet of office and retail space across three 1950s-era buildings.
The location, sandwiched between two well-known shopping destinations — the Beverly Center to the west and The Grove shopping center to the east — has seen little construction or buyer activity in recent years but is zoned for mixed-use and transit-oriented development, providing a menu of options for a potential buyer.
"There's a very frothy trend happening for retail, restaurants and entertainment a little west of our location on Beverly. This is the next area to pop," Moore told CoStar News, noting the likeliest uses for the parcel include retail, offices, residential space, a hotel or medical uses such as a memory care facility. This is the first time the parcel is hitting the market in more than 40 years, according to the brokerage.
The site, called the Block on Beverly and including 8230 Beverly Blvd. and 8256 Beverly Blvd., is up for grabs at a time when the Los Angeles commercial property market is struggling to return to pre-pandemic levels of activity. The ultimate sale of this parcel will help reveal the demand and pricing for a high-quality, large piece of land, said Ryan Patap, CoStar senior director of market analytics for Los Angeles.
Investors have been wary of Los Angeles because of its reputation for strict regulations and steep costs, exacerbated by weaker demand in recent years. The volume of commercial property sales in the city has plummeted by as much as 70% since the introduction in 2023 of the ULA transfer tax targeted at property sales exceeding $5.15 million.
Rare opportunity
The area of West Hollywood where the site is located is seeing some redevelopments started before the pandemic finally turning into new mixed-use developments. Still, "most of the legacy properties around there are owned for hundreds of years and don't trade very frequently," Moore said.
The conversions that are taking place involve reimagining office and retail properties into mixed-use apartment hubs with retail or medical use on the ground floor. The Block at Beverly site is ideal for a similar configuration, according to Patap.
The area is one of the most high-profile retail locations in the L.A. market with the highest asking rents, Patap said. High population densities, many affluent households and expensive residential real estate make the location an ideal spot for a flagship retail store or other brand activation, Moore said.
Los Angeles-based CIM Group recently acquired a five-property, 82,210-square-foot portfolio of retail buildings called District La Brea on La Brea Avenue in West Hollywood from El Segundo-based Barings for $44 million, or $535 per square foot. That property, tenanted by the likes of retailer Arc’teryx and popular sushi spot Sugarfish, won't be redeveloped.
Multifamily construction volume is down 17% in the past year in West Hollywood, while tenants moved into 10,000 more units than they moved out of in the past year, leaving vacancy relatively flat at 5%, according to CoStar data.
Memory care and senior housing is a possible use, with such operators scouting for deals in the region, according to Avison Young. Black Equities Group is developing an 80-unit seniors housing project for Clearwater Senior Living on the site of a former retail building at 8070 W. Beverly Blvd.
For the record
The Avison Young team representing the seller includes Moore, Managing Director and Principal Chris Bonbright and U.S. Capital Markets Leader and Principal Peter Sherman.