I like seeing Henry Manoucheri buy this property. When an investor with 42 years of experience buys quality Los Angeles real estate, I pay attention.
Universe Holdings paid $28 million—about $269 per gross square foot—for a building constructed in 2013. The property contains roughly 104,000 gross square feet and 76,000 rentable square feet.
The land alone could be worth $5–$7 million. Replacing the rentable structure today could easily cost more than $30 million—and that is before carrying costs, financing, and three years of construction with no rental income.
Why take development and lease-up risk when you can buy newer construction and collect rent immediately?
The going-in cap rate is around 5.5%. If Universe can grow rents and improve operations, the yield could move toward 6%.
That is the investment thesis: good cash flow from day one, a basis below replacement cost, and no construction risk. Experienced investors like Henry understand that recreating this property in Encino today would likely cost far more than the $28 million purchase price.
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