About PMI Properties

PMI is a thirty year old property investment company located in Beverly Hills/Bel Air that invests in commercial and residential real estate. Since its founding in 1978, PMI Properties has closed over $500 million in office, shopping center, industry and apartment properties throughout Los Angeles and San Francisco. PMI's most recent endeavors have focused on pioneering creative office suites in office buildings and converted warehouses.These properties have been primarily located in Los Angeles and recently in San Francisco. PMI had its roots in investing in apartments, but more recent investments have focused towards offices, creative offices and converted warehouses. PMI was the first to pioneer a new, creative suite in office buildings with its proprietary "lifestyle suites," which featured skylights, partial hardwood floors, designer lighting, raised ceilings, interior glass, and other upgrade features. PMI pre-built the suites in an efficient and generic floor plan that not only achieved a premium, but also rented faster than suites requiring build-to-suit modifications. PMI was also one of the first to convert warehouse industrial facilities into flex creative space prior to the Internet boom. Today, PMI's suites are some of the most coveted creative offices on the market. Subscribe to get our newsletter and blogs for free! http://eepurl.com/hG0V2

Drink Houz Juice Bar Opens on Temple –A Sign of Gentrification

One way we know if a neighborhood is gentrifying is the establishment of retail catering to higher income young residents. The Temple Street area, south of the 101 Freeway and adjacent to Silver Lake and Echo Park, is showing signs of gentrification as many new luxury apartment properties are being built in this area.

Now a new juice bar named Drink Houz opened on the ground floor of the recently completed HoM apartment complex at Robinson and Temple. This specialty juicery offers up cold-pressed probiotic juices, coffee, kombucha on tap, and healthy meal options. The juice bar also plans to offer a delivery service and online ordering to further accommodate busy professionals and tenants. This establishment contrasts with many of the surrounding businesses that mostly cater to the community’s middle to lower income and primarily Hispanic population.

DSC09736DSC09739

Inside Gwyneth Paltrow’s Goop headquarters in PMI’s Creative Offices in Santa Monica

Actress-turned-lifestyle entrepreneur Gwyneth Paltrow has grown her company Goop from a newsletter into a full-on force that offers advice on a wide range of topics including fashion, food, wellness, and travel. Often, the products it endorses carry outrageous price tags (a $4,700 juicer?) that some argue only an actress-turned-lifestyle-entrepreneur could afford.

The company began humbly in Paltrow’s home in London, then moved to a barn on her property in Brentwood. Less than two years ago, reports Architectural Digest, the expanding business has moved into “no-frills” Santa Monica warehouse that once housed chickens. Paltrow called in RH (the post-rebrand name of Restoration Hardware) to redo the space and give it that Goopy feel.

Paltrow says the resulting workspace really captures the “raw and energetic … very California” vibe of the company’s first office.

A variety of pendant lamps and tables set up as flexible work areas run throughout the space, which is a textbook warehouse with exposed trusses, high airy ceilings, and concrete floors.

It’s nothing cutting edge or even really exciting, but it does look comfortable. And that’s kind of the point, says Paltrow: “Since we think of Goop as a family, we wanted everyone to feel at home.”

https://la.curbed.com/2017/5/3/15532422/gwyneth-paltrow-goop-headquarters-santa-monica

PMI Renovates 200 Unit East Bay Apartment Complex Down to the Studs

pool

PMI is in the process of a substantially renovating its 200 unit apartment property in El Sobrante in the East Bay of California , approximately a 26 minute drive to San Francisco in the non rush hour traffic.  Renamed Solace Apartments, the property will be packed with amenities:

• Clubhouse with Fireplace, Media Lounge and Indoor/ Outdoor Entertaining Kitchen
• Fitness Center/Yoga Studio with Streamable Instructional Classes
• Multiple Work Stations
• Pool, Spa and Outdoor Lounge Areas with Trellis, BBQ’s, Cabanas and Large Fire Pit to Gather Friends
• Trellised Deck Overlooking Pool
• Pet Parlor/Doggie Park
• Parcel Delivery Lockers & Mail Room
• Bike Friendly – Bike Repair Station
• Barbecue Grills
• Creek & Mountain Views
• Free High Speed WIFI in Common Area Amenities

One of the most attractive things about living at Solace Apartment Homes is that it is central to everything. You’re close enough to enjoy the nature reserves around the area while also taking advantage of everything that California’s second largest metropolitan area has to offer, like quick trips to San Francisco, Berkeley, and Napa Valley. Daily conveniences like Sprouts, Trader Joes, Starbucks and a Raley’s supermarket are all within close proximity.

Wildcat Park, a wildlife reserve, is a five-minute drive away. This is a perfect location for the outdoorsy types who enjoy hiking and mountain biking along trails; you’ll forget that you even live in the Bay Area!

Solace Apartment Homes’ prime location comes with various transportation options for its residents. Solace is minutes from I-80, and the area is serviced heavily by Uber and Lyft drivers. There is an AC Transit Bus stop located on the corner of the property, a BART station approximately four miles away, and the Richmond Parkway Transit where you can Park and Share a Ride approximately two miles away.

Solace Apartment Homes is a wonderful residential community for people who love living in the Bay Area but want some distance from the congested and busy streets of larger cities.

 

 

gym

Great Room

 

Kitchen

Dining

 

Lounge

yoga room

gym

Announcing Completion of Another Creative Multifamily at 128 North Rampart Near Echo Park

We have completed construction at 128 North Rampart, a nine unit apartment renovation  near  Echo Park.  PMI ventured a half mile south of Echo Park– about two blocks north of Beverly Boulevard.  Yet, the complex is still within a mile of the Echo Park Lake.    PMI converted studios to micro one bedrooms and one bedrooms to micro two bedrooms.  At slightly lower rents, PMI is targeting its same clientele with its hip new loft like look.

 

Investment Strategy in The Current Environment of Real Estate Asset Prices

market-outlook-higher

We are currently in the expansion phase of the business cycle.  We are typically not buyers during this phase.  We are usually buyers during the  recovery phase of the cycle. The rewards during the recovery phase are great.   Values can more than double or triple over time.

We have a very difficult time navigating the expansion phase of the cycle for investment opportunities. During this phase, as is now now occurring, values reach record highs and are hard to reconcile with our past experience.  As the expansion continues, prices reach ever higher levels, and many short term investors reap very high IRR yields.  For example, many offices properties are selling for $800 to $1,100 per square foot in Los Angeles and San Francisco.  Investors who purchased and renovated properties at $600 per square foot or even higher during the last few years are now selling and making attractive IRR yields given the short holding period.  Investors who purchased Westside apartment buildings at 4 to 5% cap rates are now the selling them at higher rents at 3 to 4% cap rates.   We view this as a risky enterprise.  The longer the expansion continues, the more overly conservative we appear.  Up it goes until it blows, and the higher it goes, the bigger it blows.

During this expansion phase, we are reaping the fruits of our gains by selling, raising rents, and refinancing in order to distribute money to our investors; building the stability of our portfolio by pursuing better credit tenants and longer term lease;,  bolstering our cash resources by refinancing to replenish reserves; and asking our investors to keep some dry powder in preparation for the next great buying opportunity.”  We have experienced several of these buying opportunities where certain real estate prices fall to shocking levels.

We seem to follow the musings of Warren Buffet in his recent (February 25, 2017) letter to investors:

“…I have no magic plan to add earnings except to dream big and to be prepared mentally and financially to act fast when opportunities present themselves. Every decade or so, dark clouds will fill the economic skies, and they will briefly rain gold. When downpours of that sort occur, it’s imperative that we rush outdoors carrying washtubs, not teaspoons….”

Real estate investors tend to be optimists. It takes a lot of patience and discipline to deploy this strategy.