CMC Owners Confirm Sale
California Market Center owners said they have accepted an offer of close to $135 million to sell the 3-million-square-foot wholesale center to Los Angeles real estate firm Jamison Properties.
Escrow is expected to close during the first quarter possibly by the end of January, said Fred Barnes, president of the CMC and executive vice president of DMG World Media, the minority shareholder in the building.
Barnes said he expects Jamison to continue operating the CMC as a wholesale mart for apparel, gift and home accessory lines.
“He’s very in tune with the needs of his tenants,” said Barnes.
The CMC, which consist of three adjoining buildings located in the L.A. Fashion District, is estimated to be about 60 percent to 70 percent leased.
Majority owner Hertz Investment Group has owned the building since 2000 when it purchased it for $85 million. The company is constantly buying and selling so a sale of the building was not unforeseen, said Barnes.
In this case, the center was not on the market. Jamison approached Hertz and gave the company a solid offer. Hertz owner Judah Hertz and Dr. David Lee of Jamison have previously run across each other when Hertz sold the Banco Popular building in downtown Los Angeles to Jamison a couple of years ago.
Hertz will exit the fashion industry upon the closing of the sale. The company has lately been looking out of state for deals. It’s currently closing a $50 million transaction to buy the Gateway Center office complex in Pittsburgh, Penn., and last year purchased three properties in the New Orleans area.
Jamison owns about 70 properties in Southern California, most of which are office or medical buildings. DMG will continue to operate its gift shows in Los Angeles and across the country.
Barnes said that following the closing of the deal, DMG would like to maintain the CMC’s involvement in the California Gift Show, which DMG produces in conjunction with George Little Management LLC. Currently, the CMC runs shuttles between the California Gift Show at the Los Angeles Convention Center and the Los Angeles Gift & Home Market at the CMC. Whether that would continue will rest upon Jamison’s approval, Barnes said.
“We had a business plan and we were committed to it. But when you’re the minority shareholder, you have to go with what the majority owner wants to do,” he said. —Robert McAllister
