Affordable Apartments Fill up Fast
Amid Downtown L.A. Renaissance

The rapid lease-up of Rosslyn Lofts — residents snapped up all 259 units in just five months — certainly points to the desirability of the newly renovated property’s trademark Micro-Loft apartments, as well as to the rebirth of its once-seedy downtown Los Angeles neighborhood. But the strong demand for this mix of affordable and market-rate units also reflects the genuine need for housing among L.A. workers who would otherwise have been priced out of the market, says Buxbaum Group Chairman and CEO Paul Buxbaum, a partner in the project along with The Amerland Group.

"The need for affordable housing in downtown Los Angeles was acute even prior to the economic crisis," he notes. "But the recession has only made this worse. What is most exciting is that this property, which had a history of being a neighborhood eyesore, now is something the City of Los Angeles can be proud of. It has gone a long way toward helping improve the downtown section in which it is located."

The partnership wrapped up the renovation of Rosslyn Lofts, formerly known as the Rosslyn Million-Dollar Fireproof Hotel, in June 2009. Several mom & pops, including a modern furniture store, have signed retail leases at the property, and the revitalized neighborhood continues to attract new bars, restaurants, shops and infrastructure, says Jules Arthur, COO of The Amerland Group.

Meanwhile, the lease-up is progressing well for the partnership's other affordable-housing project in downtown L.A., the 463-room Alexandria Hotel, now more than 90% occupied. "We still have some residential units to lease up, but are pushing toward the finishing line," Arthur reports. "We have also leased all of the building's 15,000 square feet of retail space."

Downtown L.A.'s Rosslyn Lofts was fully leased in 5 months.

Perhaps the most notable new retail tenant at the Alexandria is The Gorbals, the new restaurant launched by the famed American chef Ilan D. Hall, winner of the second season of the Bravo cable TV network’s hit reality series "Top Chef." Located in the Alexandria's lobby, the quirky restaurant has received rave reviews. The Alexandria is also the new home for the Company of Angels, L.A.'s oldest repertory theater.

When it comes to appraisals, there is no place for the phrase "at first glance," he asserts. This is why Siebersma's team puts such emphasis on taking a case-specific approach that leverages its deep experience in both the wholesale and retail arenas.

In wholesale appraisals, digging deep into the nature and implications of potential wrinkles like licensing agreements and exclusivity clauses is particularly important Siebersma says. "You must ask the right questions upfront, because there are many wholesale-specific factors that can be critical to making an accurate appraisal," he explains. "Appraisal firms that lack wholesale expertise will likely miss some of these key distinctions."

Those distinctions are top-of-mind for Buxbaum Group, not only because of its increasing focus on wholesale appraisals and lender relationships over the past decade, but also because the company's principals are deeply involved in both the wholesaling and manufacturing sectors. "Our executive team deals with these dynamics every day," Siebersma notes. "For example, our operation of Honduras-based Rio Garment allows us to be deeply familiar with all of those factors that encompass the manufacturing and importing of goods from another country."

Buxbaum Group Chairman and CEO Paul Buxbaum, meanwhile, also serves as CEO of Dallas-based Haggar Clothing Co., the instantly recognizable, 80-year-old manufacturer

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