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Retail Site Sold in Westchester

Irvine real estate firm Passco pays $95million for the Promenade at Howard Hughes Center.

June 18, 2005|Roger Vincent | Times Staff Writer

The Promenade at Howard Hughes Center, a Westchester retail complex that includes luxury movie theaters, has been sold for $95 million to an Irvine real estate investment company.

Passco Real Estate Enterprises Inc. bought the 248,000-square-foot property from developers J. H. Snyder Co. of Los Angeles and Orix Real Estate Equities, the companies that built the center along the San Diego Freeway in 2001.

Anchoring the mall is a 17-screen cinema called the Bridge, which has an IMAX theater, reserved seating and a bar. Other large stores include Borders Books & Music and Nordstrom Rack, along with several small restaurants.

The center is about 95% leased and is part of Howard Hughes Center, Arden Realty's 2.4-million-square-foot office campus on Center Drive.

There was a lot of competition for the property, said real estate broker Reza Etadali of Reza Investment Group, who represented both parties in the transaction. Modern retail centers such as the Promenade have experienced growing demand from investors since the dot-com bubble burst, he said.

"The illusions about the Internet taking over retail went away and it's having a huge resurgence of interest," he said.

Passco specializes in real estate trades that are covered by Section 1031 of the U.S. Tax Code, under which the owner of an investment property who swaps it for a similar property does not have to report a capital gain immediately.

The center will be offered for sale to 1031 tenant-in-common investors, said Passco President William Winn.

The company manages or is developing more than 7 million square feet of commercial properties, including Puente Hills Mall in the City of Industry and the Village at Orange in Orange.

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