Harkham Family Sold Rodeo Drive Hotel to Luxury Goods Company LVMH in December
By Jack Witthaus CoStar News February 28, 2022 | 5:17 P.M.
Months after selling a $200 million property on tony Rodeo Drive in Beverly Hills, a Los Angeles family investment office has snagged more than an acre in Hollywood near a bevy of redevelopment projects catering to the entertainment and tourism industries.
An entity related to the Harkham family bought roughly 1.3 acres with around 25,000 square feet of industrial space and a four-unit apartment building at Seward Street and Hudson Avenue near Santa Monica Boulevard, according to CoStar data and marketing materials. The sale price was roughly $22 million, and the seller was Pasadena, California-based Mader Inc., according to CoStar data. The buyers want to market the space for creative office use and said they have multiple letters of intent on the property after closing less than two weeks ago, according to Aron Harkham, who runs acquisitions for the family. The property's space may be upgraded in the future, too, he said. Newmark's Jay Luchs is marketing the property for lease.
"We're not looking at this as knocking it and building a massive building there," Harkham told CoStar News.
The family investment office is in the middle of a shopping spree as part of a 1031 exchange after selling the 80-room Luxe Hotel at 360 N. Rodeo Drive for an eye-popping $200 million, or about $2.5 million a room, to French luxury retailer and developer LVMH in December 2021. The Harkham family plans to buy more than a dozen properties across the U.S., including multiple properties in greater L.A., as it redeploys the cash from the Luxe Hotel sale. A 1031 exchange allows investors to roll proceeds from real estate sales into other properties of like value to defer some tax payments. The family investment office is pivoting away from the hospitality business as it buys other real estate, Harkham said. Earlier in February, the family office also bought the 13,000-square-foot 157 S. Fairfax Ave. retail space across from the high-end Grove shopping center in L.A. for an undisclosed amount.
The Harkham family still owns the upscale Luxe Sunset Boulevard Hotel in the Brentwood neighborhood of Los Angeles, along with other properties in downtown Los Angeles and on the Westside, Harkham said.
Some of the Seward Street buildings, in an area that's known for its historic film and music production, date back more than 100 years. That history has lured some big-name developers to the neighborhood in recent years with conversion and redevelopment plans. In December, Canadian developer Onni Group bought the nearby 83,000-square-foot Howard Hughes Headquarters Building at 7000 Romaine St. along the trendy Sycamore Avenue for $40 million. Such investment in the neighborhood has attracted music brands, advertising firms and creative content and production companies.
Not far from the Seward Street site, a 10-story office and restaurant redevelopment project is planned for 1000 N. Seward. In 2021, Los Angeles developer Hudson Pacific Properties signed leases for its first tenants at its completed Harlow project, a four-story, 130,000-square-foot creative office building at nearby Hollywood production lot Sunset Las Palmas Studios.
The seller did not respond to a request for comment from CoStar News.