Sycamore District’s Old Hollywood Industrial History Lures Investors, Celebrities and Luxury Brands
By Jack Witthaus
CoStar News
December 29, 2021 | 2:34 P.M.
A Canadian developer on a Los Angeles shopping spree has bought another building, this time a site once owned by the legendary businessman Howard Hughes in one of the city’s most desirable neighborhoods.
An entity related to Vancouver-based developer Onni Group purchased the 83,000-square-foot Howard Hughes Headquarters Building at 7000 Romaine St. in Hollywood for $40 million, or about $480 per square foot, according to CoStar data. The seller was an entity related to Los Angeles-based Producers Film Center, which had a climate-controlled film and audio storage facility on the site. The 91-year-old building comes with a rich history and is located in what's now known as the Sycamore District. Built in the art deco style, the building features ornamental detailing such as Egyptian imagery and floral patterns, according to city of Los Angeles documents. It served as a brewery, candy factory and as a World War II ammunition plant, records show. Starting around 1930, Hughes operated his businesses from the building until his death in 1976.
In recent years, the neighborhood surrounding 7000 Romaine has been a magnet for real estate investment. In 2021, Los Angeles-based developer CIM Group completed 926 Sycamore, an eight-story, 80,000-square-foot office and retail project that's next to 7000 Romaine.
It's unclear what Onni's plans are for the site, and the developer and seller didn't respond to emails and calls from CoStar News requesting a comment.
Real estate investors have been attracted to the neighborhood's old Hollywood industrial history, and so have celebrities and luxury retailers who have moved their businesses there, said Nicole Mihalka, managing director of JLL who is marketing 926 Sycamore but was not involved in the 7000 Romaine deal. Office tenants interested in the neighborhood include music brands, advertising firms as well as creative content and production companies. Mihalka said the Sycamore District has been among the most active areas for office leasing in Los Angeles even during the pandemic.
Meanwhile, high-end concepts such as Gigi’s restaurant and retailer Just One Eye have also set up shop in the sought-after neighborhood.
"That has been the magic of this district. For years, people didn't know what was happening in these buildings," Mihalka said. "Celebrity-driven brands have wanted to be here because they like the authenticity of the older industrial product."
It's the latest property Onni has purchased in Los Angeles during an active acquisition period. In December, the Canadian developer bought Marina Shores, a retail property in Long Beach which it plans to redevelop into apartments. In addition, the developer acquired a half-acre site in West Los Angeles for an apartment redevelopment project.
In November, Onni bought a majority of the 1.2 million-square-foot Burbank Town Center for $136 million. The purchase included the buildings only, which are subject to a ground lease.
"Hollywood is an excellent location for both new offices and apartments," said David Nusbaum, senior market analyst for CoStar Group. "There's high demand for new offices in the area from media and entertainment tenants which has led to redevelopment of older flex properties."