Canyon Partners Real Estate, a prominent division of global asset manager Canyon Partners, is making significant strides in the mixed-use property sector of Southern California.
Between May and August, the firm successfully closed over $130 million in senior bridge loans specifically for multifamily, senior housing, and mixed-use developments.
Spencer Schlee, who leads the company’s west region team out of Los Angeles, plays a vital role in originating, structuring, underwriting, and executing debt and equity financing for these projects.
Mixed-use developments stand out particularly in Southern California for their synergistic design, which enhances both residential and commercial experiences.
By integrating residential units, commercial spaces, and communal amenities, these projects create an environment where residents, employees, and visitors can thrive.
Crucially, these developments are situated in neighborhoods that prioritize safety, walkability, and a curated selection of retail options, ideally located near transit hubs.
Financing strategies for mixed-use projects are distinctly comprehensive, differing from those of other asset types.
These strategies consider the overall project as well as its individual components, requiring flexibility to allow for future refinancing or exits.
Such flexibility is essential for optimizing the owner’s financial strategy and effectively adapting to unpredictable market dynamics.
However, the development of mixed-use projects does come with its set of challenges.
One key obstacle is ensuring that the commercial element is as well-planned and appealing as the residential component.
This means meeting the demands of effective design for commercial tenants while also facilitating seamless access and parking between various uses.
Investment attitudes toward mixed-use projects fluctuate across the different markets in which Canyon Partners operates.
Successful market selection hinges on the assurance that each use can attract sufficient demand to thrive independently, while still benefiting from being part of a broader mixed-use environment.
When assessing whether to finance or refinance a mixed-use development in Los Angeles, several pertinent factors come into play.
The attractiveness of the location and the capability of each component to achieve full, stabilized occupancy are paramount.
Additional considerations include neighborhood safety and walkability, protection against competitive new supply, and the experience and track record of the borrower.
These combined factors are vital in evaluating the project’s potential for success and its sustainability over the long term.
Looking ahead, the future of mixed-use developments in Southern California appears promising.
Given the acute housing shortages in Los Angeles and the broader Southern California region, demand for mixed-use projects—especially those that enhance the living experience with complementary commercial options—is likely to remain strong.
Projects that are adaptable to shifting resident needs, such as those offering flexible working spaces, ample parking, unique food and beverage options, and high-end amenities, are set to excel in this evolving landscape.
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