Introduction to Aflalo Family’s Beverly Hills Properties
The Aflalo family hopes to sell four parcels entitled for a combined 368 residential units in Beverly Hills, according to a new offering memorandum from Westmack Commercial Brokerage Company.
The parcels, all builder’s remedy projects clustered at West Olympic Boulevard and South Beverly Drive, are listed from $20 million to $87 million, with a combined value of $132 million.
Details of the Properties
Plans call for 74 affordable units spread over the four projects, along with 37,276 square feet of ground-floor retail, and parking. Sites include 333-337 South Beverly Drive and 353 South Beverly Drive, approved for an eight-story building with 135 residential units, 16,099 square feet of ground-floor retail, and three levels of subterranean parking with 263 parking spaces; and the Pavilions grocery store site at 9467 West Olympic Boulevard, with an eight-story building with 105 residential units, 17,085 square feet of retail, and three levels of subterranean parking with 180 parking spaces. Those sites are priced as a package at $87 million.
Ownership and Entitlement Process
Sammy Aflalo of Aflalo Equities helmed the entitlement process of the two sites. Sammy Aflalo is the son of Moshe and Laura Aflalo, whose Aflalo Family Trust grew a portfolio of stores in L.A.’s Fashion District in the 1990s. The sites are co-owned with Harkham Family Enterprises, run by Uri Harkham, also a prominent property holder in the Fashion District and well beyond.
Additional Properties
The offering also includes 9430 West Olympic Boulevard, approved for a 13-story mixed-use building with 53 residential units and three levels of subterranean parking with 23 parking spaces. The tower would replace a three-story commercial building built in 1989. It has an asking price of $20 million.
Also part of the offering is 9441 West Olympic Boulevard, approved for a 13-story building with 75 residential units, 4,092 square feet of ground-floor retail, and three levels of subterranean parking with 52 parking spaces. Its asking price is $25 million.
Builder’s Remedy and Market Implications
Builder’s remedy is a loophole in state housing law that lets developers skirt zoning rules in cities that fail to certify their state housing plans, as long as they include at least 20 percent affordable housing.
“These approvals, granted under builder’s remedy, allow for height, [floor area ratio] and unit counts that far exceed surrounding properties,” said Westmack’s Macker, who holds the listing for the properties.
As of Oct. 30 there were 14 active builder’s remedy applications before the City of Beverly Hills, according to Ryan Gohlich, assistant city manager in Beverly Hills.
Market Response and Concerns
Beverly Hills Mayor Sharona Nazarian said on the general topic of builder’s remedy that there’s a mismatch between policy intent and market outcomes.
“What was intended as a tool to create more affordable housing has, in practice, often been used to push through ultra-luxury, high-density projects, and with only a small fraction of them being actual affordable units,” Nazarian told The Real Deal at the end of October. “And it’s unclear whether there’s sufficient demand for so many expensive luxury units. Prices continue to rise, and the average renter or young families or young professionals, they’re still being priced out.”
Macker touted the offering for its “scale, prime location, and significance in a market known for its limited supply.”
Conclusion
The Aflalo family’s decision to sell their entitled properties in Beverly Hills comes at a time when the city is grappling with the implications of builder’s remedy projects. While the properties offer a unique opportunity for developers, concerns about affordability and market demand remain.
FAQs
Q: What is the total value of the properties being sold by the Aflalo family?
A: The combined value of the properties is $132 million.
Q: How many residential units are included in the four projects?
A: The four projects include a combined 368 residential units.
Q: What is the price range of the properties being sold?
A: The properties are listed from $20 million to $87 million.
Q: What is builder’s remedy and how does it impact development in Beverly Hills?
A: Builder’s remedy is a loophole in state housing law that allows developers to skirt zoning rules in cities that fail to certify their state housing plans, as long as they include at least 20 percent affordable housing.
Q: How many active builder’s remedy applications are currently before the City of Beverly Hills?
A: As of Oct. 30, there were 14 active builder’s remedy applications before the City of Beverly Hills.
Read more
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Fisch unveils 13-story builder’s remedy project in Beverly Hills
