(Bloomberg) -- A rental housing complex in Malibu, California, is slated to be sold as condos to help meet the demand for luxury homes in the coastal city.
Real estate investment firm BH3 Management bought the 68-unit property in the beachfront community of Point Dume for more than $70 million, according to public records. The company said it plans to start offering the apartments for sale early next year.
Malibu, an enclave northwest of Los Angeles with more than 20 miles (32 kilometers) of coastline, has been a magnet for wealthy homebuyers seeking a refuge near the ocean. Yet the supply of land and condos for sale is limited. There hasn’t been any “meaningful inventory” that’s become available in the past 15 to 20 years, according to Daniel Lebensohn, a co-founder of BH3.
“When you look at the velocity of sales, you see that properties do move rapidly,” Lebensohn said in an interview. “We instantly saw opportunity here and found this property to be fairly singular.”
The complex, at 6487 Cavalleri Road, includes four buildings on more than 10 acres (4 hectares) of land. The property has two- to three-bedroom residences, including townhomes and penthouses, with a quarter of the units offering views of the Pacific Ocean.
Lebensohn declined to provide pricing information for the condos but said his firm sees an “attractive spread” between its acquisition price and the sell-out value of the 68 units.
While the complex was operated as a rental for many years, it was originally built as a condo, so no special approval is needed, Lebensohn said. Existing amenities include a pool, hot tub, fitness center and tennis courts.
Condos are relatively rare in Malibu, an area better known for its lavish mansions that have toppled price records even as the threat of wildfires increases.
Just 26 condo units were listed for sale in Malibu at the end of September, according to data from Douglas Elliman Real Estate. The three condos that traded hands that month sold for a median of $1.8 million, the brokerage said.
©2024 Bloomberg L.P.
