MREC Buys Residential Property in Southern California
This is the fifth property MREC has acquired in Southern California since August 2010.
MREC acquired the property in a joint venture with Harridge Development Group, which was formed by David Schwartzman, a Los Angeles-based real estate developer. MREC is looking forward to additional investments of $50m to $100m with Harridge in this submarket.
The acquisition consists of the purchase of a property entitled for 67 residential units, plus an adjacent commercial parcel also zoned for apartment use. The transaction closed on July 1, 2011.
MRECâ€™s homebuilder joint venture program is led by managing director Joel Kaul in Minneapolis.
Lance Franklin, senior director at MREC, said: â€œWe believe there is strong demand for urban infill housing in Los Angeles and intend to partner with Harridge to develop the Silver Lake site as well as other projects in the near future.
â€œWe are excited about starting a relationship with Harridge Development, which has a team of talented and creative professionals that have worked together for over 15 years. They have a proven track record of entitling and developing challenging projects in Los Angeles. Their knowledge of the local market and their dynamic skill set will provide MREC opportunities to invest further in the Los Angeles infill market.â€
The MREC JV will work with the city to redesign the north parcel to a lower density residential use. The south parcel plan will be entitled for similar lower density or possibly apartment use. The finished lots will be sold to homebuilders targeting infill locations.
Over the past 18 months, MREC acquired over 8,800 lots and 7,000 acres with over $230 million committed to 16 joint ventures.
Will the acquisition enhance MREC market position in California?
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