As a part of our broader strategy to invest in emerging urban areas, we’ve acquired the Los Angeles Design Center, a mixed-use property in the Hyde Park area of Los Angeles, for approximately $15 million.

The property is well-positioned in the short term to serve a large commercial tenant, while the surrounding neighborhood holds potential for transformative growth, giving the asset the possibility for redevelopment over the long term.

Business plan

This unique property is currently comprised of three buildings with a mix of office and warehouse space, totaling 75,000 square feet of rentable space on 1.75 acres.

To accommodate the sale, we agreed to a two-month lease back arrangement with the seller. Once they move, we plan to lease the space out to a new tenant. In addition to the $15 million we paid for the property, we anticipate spending about $1 million on light improvements to build out the space for the new tenant.

Our goal with this investment is to begin earning consistent rental income by leasing up and building out the space, while at the same time capturing what we believe will be strong price appreciation over the next several years as the Hyde Park area matures.

If we see sufficient growth in the area, the property’s location and large size make it a good potential candidate for more extensive redevelopment further down the road.

Why we invested

  • Attractive price: Our team was able to acquire this asset at an attractive purchase price in comparison to similar properties, giving it more room to grow.
  • Leasable asset with long-term potential: The property doesn’t need much work to get it in good shape for a new tenant, but it also carries the potential for more extensive redevelopment later on if the economics support it.
  • Up-and-coming neighborhood: Creative users, including artists, filmmaking studios, and e-commerce companies, are expanding into Hyde Park, setting up the area for substantial potential growth over the next several years.

As always, please don’t hesitate to reach out to investments@fundrise.com with any questions or feedback.