Pegasus advised on the $6.5-million acquisition of the Laemmle NoHo 7, a marquee theater-anchored mixed-use retail and office property located in the NoHo Arts District in North Hollywood. Pegasus exclusively advised the buyer, a Los Angeles-based investor group led by the Laemmle family, founders and operators of Laemmle Theatres. Located at 5240 Lankershim Blvd in North Hollywood, the 32,809-square-foot property was originally constructed in 2011.
The acquisition was completed as part of a 1031 exchange following the disposition of a former theater asset previously owned and operated by the family. During the process, a rare opportunity emerged to reacquire a signature asset previously owned by the Laemmle family.
In 2021, amid a frothy development market and pandemic-driven headwinds facing the theater industry, the family sold the NoHo Arts District property to a Charlotte-based development group that planned to redevelop the site into a mixed-use project.
“We were under immense pressure to reduce debt and preserve equity,” recalled Greg Laemmle, owner and president of Laemmle Theatres. “As much as I hated to let the NoHo 7 go, at the time it felt like the only way to keep the business afloat.”
Ultimately, a confluence of factors, including the prolonged and costly entitlement process in Los Angeles, affordable housing mandates, shifting capital markets and the implementation of ULA transfer taxes, rendered the housing project infeasible. Given the headwinds facing the developers, the investment group was presented with an opportunity to reacquire the property.
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