Zell's equity residential on Valley apartment buying spree.

EQUITY Residential has purchased two apartment complexes in Valencia and a controlling interest in a Woodland Hills project in deals that could be worth more than $150 million.

The Chicago-based real estate investment firm, whose chairman is Equity Office Properties Trust Chairman Sam Zell, bought out joint-venture partner Legacy Partners Residential Inc.'s interest in four apartment complexes nationwide, including the 315-unit Bella Vista at Warner Center. While the value was not disclosed, Equity had funded 30 percent of the $81 million development as of Dec. 31, 2003, according to a Feb. 4 filing with the Securities and Exchange Commission.

With well-located apartment complexes in the San Fernando Valley selling for between $250,000 to $300,000 a unit, according to Dean Zander, partner at Hendricks & Partners, Legacy's share could be worth between $55 million and $65 million.

Last month, Equity Residential bought the 270-unit Riverwalk at Town Center apartments from Astani Enterprises Inc. for $48 million, according to Sonny Astani, the firm's president. The three-year-old property is 90 percent occupied, with rents ranging from $1,500 to $2,500 a month.

That transaction follows its purchase of the 294-unit Jefferson at Town Center nearby. The price paid there was not disclosed, though it is believed to be comparable to that of Riverwalk.

The transactions extend the firm's reach in the Santa Clarita Valley. Equity now owns nine apartment complexes totaling more than 2,000 units in Valencia, Santa Clarita and Stevenson Ranch.

"There is an emerging path of development out there," said Chris Beda, first vice president at Equity, which targets newer buildings. "It's one of the few places (in Los Angeles County) where new construction is occurring."

The firm is buying into a Valencia apartment market where rents averaged $1,545 a month in the fourth quarter, about 15 percent more than the countywide average, according to RealFacts.

Foreign Exchange

For the second straight year, Los Angeles real estate was the third most attractive U.S. investment for foreign buyers, according to a survey by the Association of Foreign Investors in Real Estate.

Washington, D.C. and New York took the top two spots.

"Frankly, it's a little surprising to us," said Jim Fetgatter, chief executive of the group. "Our organization is heavily European and Europeans aren't really known for heavy investing on the West Coast."

Among other factors, Los Angeles has benefited from increased investment from Australia-based firms like the Westfield Group, whose domestic affiliate, Westfield America Trust, owns Westfield Shoppingtown Century City and Westfield Shoppingtown Fashion Square in Sherman Oaks.

"L.A. seems to be the place where (Australians) step off the plane first," said Fetgatter. "It's the same reason the Dutch invested in Atlanta in the '80s. There were direct flights."

Landlord to Tenant

Specialty Laboratories Inc. has sold its yet-to-be-completed Valencia headquarters to New York-based real estate investment trust Lexington Corp. Properties Trust for $47 million in a sale-leaseback deal.

Specialty will lease the entire 198,000square-foot building on Tourney Road from Lexington when the project is completed later this year. The company is moving from Santa Monica. The value of the 20-year deal was not disclosed.

"The company thought it made more sense to pull cash out of the facility," said Matthew Miller, principal at CRESA Partners, who, with CRESA's Gerald Porter, represented Specialty on the deals. "It's good timing in the real estate cycle to do that."

Specialty, which occupies about 95,000 square feet in four Santa Monica facilities, bought the 14-acre site in late 2001.

Lexington, which owns about 21 million square feet of property nationwide, specializes in purchasing single-tenant buildings.

Miracle Mile More

Decron Properties Corp. purchased the 86,000-square-foot building at 6222 Wilshire Blvd. from Oaktree Capital Management for $14.5 million and is moving to the Miracle Mile locale from its longtime home in Van Nuys. Decron, which is attempting to redevelop the Furama Hotel and owns Airport Spectrum--both near Los Angeles International Airport--paid $170 a foot for the 19-year-old building on Wilshire near Crescent Heights Boulevard.

The building, 84 percent occupied at the time of sale, will be nearly full once Decron moves in.

"It's a pretty good deal, once you factor in (Decron's) occupancy," said Bob Safai, president of Madison Partners, who represented both sides of the deal.

Oaktree, an investor in Playa Vista developer Playa Capital LLC, had bought the building from Shuwa Investments Corp. about three years ago.

Attorney to the Stars

Law firm Sheppard Muilin Richter & Hampton LLP is moving its Westside office to 1901 Avenue of the Stars in Century City from the Tower in Westwood, signing a 10-year lease worth more than $8.3 million.

The county's 23rd largest law firm, headquartered downtown at BP Plaza, will leave its 3,000-square-foot office at 10940 Wilshire Blvd. for 26,000 square feet at 454,000-squarefoot Century City tower.

"The space is to accommodate their entertainment group," said Stephen Bay, executive vice president at CB Richard Ellis, who, with CB's Hunt Barnett, represented the tenant. "This building was the best match of price and quality."

Cushman & Wakefield Inc.'s Eric Olofson represented the owner, Douglas Emmett.

Staff reporter Danny King can be reached at [phone] ext. 230, or at [e-mail].