In a significant move that underscores the challenges currently facing the commercial real estate market, JP Morgan Investment Management has offloaded an apartment complex in Los Angeles’ Little Tokyo at a roughly 30 percent discount. The 240-unit Arrive Wakaba apartment complex, located at 232 East 2nd Street, was sold to FPA Multifamily for $80.2 million, or roughly $333,953 per unit, according to public documents reviewed by The Registry. This sale closed on August 9, 2024.
JP Morgan originally acquired the property in February 2020 for nearly $115,750,000, marking a sharp decline in value over just a few years. The deal is indicative of the broader trend of discounted property sales in the Downtown Los Angeles area. Recent multifamily transactions in the region have hovered around similar price points, further highlighting the market’s current state.
This sale is part of a broader strategy by FPA Multifamily, a San Francisco-based real estate investment firm, to capitalize on the downturn by acquiring properties at reduced prices. FPA has been on an acquisition spree, particularly in Los Angeles, where it purchased the 888 at Grand Hope Park from CIM Group for $186 million, or approximately $354,285 per unit, in March 2024, according to previous reporting by The Registry.
FPA Multifamily’s acquisition strategy is not limited to Los Angeles. In 2023, the firm ranked as the 23rd largest apartment owner in the U.S., and it has expanded its portfolio across other major cities. In Chicago, FPA made significant investments in the past year, including a $96 million purchase of a 558-unit complex and a $144 million acquisition of a 500-unit tower. The firm also added a 270-unit property to its portfolio in March for $60 million, according to industry reports.
In 2024, the multifamily industry in Los Angeles has shown remarkable resilience and adaptability in the face of economic challenges and shifting market dynamics. According to published reports, the city’s multifamily sector is benefiting from sustained demand driven by a growing population and limited housing supply, despite concerns about affordability and regulatory pressures. The market is also seeing a surge in investment from institutional buyers, reflecting confidence in the long-term potential of the Los Angeles multifamily market.
