Former Jehovah’s Witnesses Assembly Hall Parcel Changes Hands For Third Time In Four Years

I came across this fascinating press release today about the sale of the 8 acre parcel of land that was the former site of the Jehovah’s Witnesses Assembly Hall (still visible in the Google Maps satellite image).  This site is across from Keyes Woodland Hills Nissan and adjacent to the Avalon Woodland Hills apartment complex.

In 2007 the property was sold for $48 million with the lofty (and insanely unrealistic) goal of building 355 condos with 18,000 square feet of retail space.  How is that even possible?  Maybe the laws of physics cease to exist on this property.  While the Jehovah’s Witnesses (presumably they were the 2007 sellers) made out like bandits in the deal, in the market downturn the buyer, JPI development, undoubtedly ‘lost their ass’ and defaulted on the property.  You can rest assured that your federal tax dollars went to clean up that mess, one way or another.

Now, another company has purchased the property for a still outrageous $25 million dollars with the hopes of developing it with less lofty goals.  To me, this property is worthless unless the deed comes along with a permit to bulldoze Avalon Woodland Hills.

Here’s the press release:

The Lee & Associates Multi-Housing Investments Group, a member of the Lee & Associates group of companies, has transacted the purchase of a prominent Woodland Hills property of approximately eight acres sold by Bank of America.

This is the third time in four years that the property, on the former site of Jehovah’s Witnesses Assembly Hall at 20600 Ventura Boulevard, has changed hands. Craig Stevens and John Battle, principals of Lee & Associates and members of the multihousing group, brokered each of the three sales. The other agents for the latest transaction are Lee principal Jim Fisher and associate Mike Smith.

“I never would have imagined when I sold this site the first time that this would still be an empty parcel of land,” said Stevens, who, along with the rest of the multihousing team, represented the buyer in this latest transaction. “In 2006 it seemed like we would never keep up with the apartment and condo housing demand, and this project, with its great location and elevations offering panoramic views of the Warner Center and the San Fernando Valley, promised to be among the very best of the projects in development.”

Additional details of the transaction were not disclosed.

The property was acquired for $25 million in 2006 by the Troxler Group and Lehman Bros.  The Troxler Group guided the property through the development process

and completed plans to build 355 entitled condominium units with 18,000 square feet of retail.   In 2007 the Troxler Group sold the property to JPI Development for $48 million, but before JPI could realize its plans, the real estate market turned downward, credit markets froze and the property fell into default.

The property was again listed for sale and attracted multiple offers over the last four months as the market began to revive. A group out of Orange County emerged as the buyer.

The developer will re-entitle the parcel, and it is too soon to tell how many units the group will decide to build, but it is likely that the final project will be less than the density first envisioned for the property.

“The latest sale price reflects a new economic reality in the marketplace,” Stevens said. “With banks requiring much more equity than they did in the past, bigger projects are not always better.”

In the past, developers were able to obtain financing based upon rental growth trends and the strong housing demand. But today, rental growth assumptions are lower, and developers must allow for rental concessions and a longer time frame to lease up units.

“The whole underwriting process has changed significantly,” said Stevens.

How much do you want to bet that the property will be flipped again in a year for another staggering loss?

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• Article Link: Press Release