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Saturday, Feb 4, 2023

Luxe Developer Eyeing Glendale

Just a year after proposing a large live-work complex for an entire downtown Glendale block, developer Amidi Group has pulled out of the project. But the city looks to be in store for something even more, as Fifield Cos., a big-time Chicago luxury developer, is coming in. Amidi received preliminary approval for 535 apartments at Lexington and Central avenues last October – what would have been the city’s largest project since the Americana at Brand. But the Redwood City developer quietly bowed out after initial design approval and never closed on the land. Now, Fifield, which is known for luxury residential towers and has some high-end Los Angeles offerings, is scheduled to close on the 3.2-acre block, owned by CitiGroup Inc. of New York, this month. Fifield did not return several emails and calls seeking comment, but the group will be before the City Council with its proposal on Tuesday. “I would expect this to be even more upscale than the rest of the Glendale product,” said Fred Cordova, executive vice president out of the Beverly Hills office of Kennedy Wilson. Amidi proposed converting an office building that houses 300 Citigroup employees into residential units, and constructing three additional buildings of up to eight stories. The developed space would have totaled about 600,000 square feet. Thomas Bohlinger, executive vice president at the El Segundo office of CBRE Group Inc. and listing broker on the land, said Fifield was an initial bidder and returned to the project when Amidi “would not meet terms.” Bohlinger would not be more specific, but local sources believed the land costs alone were $30 million and a year later could be substantially more for Fifield. In addition, Amidi received approval this summer for a smaller mixed-use project in Glendale, where there are some 3,500 units recently completed, under construction or going through the entitlement process in the city’s biggest building boom in two decades. Amidi and Rodney Kahn, a Glendale consultant that was working with the developer, did not return calls seeking comment. ‘Well capitalized’ Glendale Mayor Zareh Sinanyan said the city is well aware of Fifield’s involvement in the property, but Glendale city officials said that as of late-October they had not received a formal development application. However, given Fifield’s track record, Glendale could be in store for its most upscale residential offering yet. The company was founded in 1977 by Steven Fifield as a suburban office developer in Chicago. His wife, Randy Fifield, is vice chairwoman and runs the company with him. In its 34 years, the firm has developed more than 50 high-rise office and residential buildings, including projects in Las Vegas, Florida, Chicago, Washington, D.C. and even Honolulu, Hawaii. In Los Angeles, the company has developed a number of luxury condo towers. During the building boom, it started work on the Beverly West development but sold it for more than $95 million, or about $2,000 per square foot, in 2007. The project features just 35 units in a 22-story tower with a doorman. It was bought by Emaar Properties from Dubai, which finished construction. The company also developed The Californian, a 74-unit condo tower at 10808 Wilshire Blvd. in 2005. A penthouse unit sold late last year for nearly $10.8 million, according to listing site Zillow. The complex features valet parking, a resort-style pool and similar amenities to Beverly West. The company earlier this year completed the first phase of its $220 million Avant upscale apartment building on Figueroa and Flower Streets. The 443-unit project is a joint partnership with Century West Partners in L.A., a company also founded by Steven Fifield. Cordova from Kennedy Wilson thinks Fifield could be trying to bring a similar product to Glendale. “For a company like Fifield, which is higher end, they may see an opportunity to target the market at a different price point,” he said, adding it might consider a condominium complex. “Fifield is definitely well capitalized and I would expect a complete resizing and repositioning.” Director of Community Development Hassan Haghani said the city would be open to a luxury development. “We look for every project to be even more refined than the previous ones, both in terms of the projects themselves and in the way they relate to the overall context of our downtown,” he said. Currently, the most upscale multifamily project in the city might be the Americana at Brand. L.A. developer Caruso Affiliated has 242-apartment units and 100 condos attached to its massive outdoor mall. A one-bedroom apartment starts at about $2,500 a month. One proposal that seems unlikely: building office space. The city had a vacancy rate of 18.3 percent in the third quarter, according to the L.A. office of Colliers International. Development surge The broker community has been speculating on how much Fifiled will have to pay for the land. It was widely believed that Citi could have been asking as much as $30 million on the property, but Sev Keshishian, senior associate and multifamily expert at the Encino office of Marcus & Millichap Inc. said Fifield could be buying it for $40 million prior to any entitlements. “Really anywhere in that downtown Glendale business district is a highly attractive piece of property and a lot of people would be after. The developers are definitely bullish,” said Keshishian, who has lived in Glendale for 26 years. Meanwhile, Amidi remains committed to the city. In June, it received approval to construct a $30-million mixed-use project on 1.3-acres at Orange and Brand Boulevards. The development will feature 219-apartments, nine live-work units and 5,000 square feet of restaurant space. Amidi, co-founded by brothers Rahim Amidi and Saeed Amidi, has developed up and down the state. It owns media-oriented office buildings in Glendale and Hollywood, and built everything from a business accelerator in Sunnyvale to live-work units in Oceanside. Its most notable project is TenTen Wilshire, which it completed in 2007 just west of downtown at Wilshire Boulevard and Beaudry Avenue. The project involved converting the 360,000 square-foot former headquarters of Signal Oil Co. into 227 condominium units at a reported cost of $50 million. Cordova of Kennedy Wilson said Amidi probably looked at the market and decided Glendale couldn’t handle such a large surge of multifamily units and decided on the smaller project. “There’s a huge amount going on in Glendale. It’s probably over-building right now. That’s the gut feeling as to why they (Amidi) bailed,” he said. The most notable project under construction is the 303-unit Glendale Triangle, a 315,000 square-foot development from Camden Property Trust of Houston on San Fernando Road and Central Avenue in the southern part of the city. In addition, the Council gave first phase approval in July to a 180-unit project on 1.8-acers at Pacific Avenue and Broadway, along the San Fernando Corridor. That project is from American General Design in Pasadena. “These developers are thinking that the newer generation of workers are not going to really step into the home ownership category. I don’t think the market will bear all this,” said Keshishian, who added that he has a “very, very good feeling” the new projects are not commanding expected lease rates. What’s more, he said regardless of Fifield’s financial strength or proven track record, building in Glendale would be a risk. “Product couldn’t be online until 2017 or 2018 and who knows where the market will be then,” he said.

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