News | August 5, 2019

Gaw Capital And DJM Acquire Hollywood & Highland

LOS ANGELES--(BUSINESS WIRE)--

DJM, a San Jose-based private equity real estate and development firm, and Gaw Capital USA, a Hong Kong and Los Angeles-based real estate private equity firm, announced ownership of Hollywood & Highland, one of the country’s busiest and most acclaimed shopping centers. DJM and Gaw Capital have acquired the 463,000 square foot shopping destination for an undisclosed amount. Natixis financing team led by Jerry Tang and Greg Murphy provided the financing package which included acquisition loan along with the future funding component.

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Gaw Capital and DJM Acquire Hollywood & Highland (Photo: Business Wire)

Gaw Capital and DJM Acquire Hollywood & Highland (Photo: Business Wire)

Both DJM, a leading U.S. commercial real estate developer and asset manager with decades of experience in the Southern California market, and Gaw Capital, an industry leader globally known for adding strategic value to under-utilized real estate, have extensive experience specializing in the redevelopment and repositioning of iconic assets.

DJM and Gaw Capital formed a partnership playing to their respective strengths: Gaw Capital’s strength in capital markets and successful repositioning of assets around the world, and DJM’s deep understanding of the Los Angeles market, experiential retail and development. Advised by Eastdil Secured, Hollywood & Highland is the largest single-asset retail transaction to take place outside of Manhattan in nearly three years.

Together, the partners plan to reimagine the 7.6-acre site over the next 24 to 30 months. Built in 2001, the project sits at the crossroads of Hollywood Boulevard and Highland Avenue, and adjacent to the acclaimed TCL Chinese Theater. Drawn to this covetable location and high-traffic volume, the team will upgrade the retail hub and focus on rebranding, upgrading common areas with an eye to creating more desirable gathering and programming spaces, ramping up entertainment events, optimizing the merchandise mix and incorporating new concepts and uses that bring excitement to retailers, visitors and other tenants at the property.

“The retail landscape has shifted, consumer tastes have adapted, and ‘New Hollywood’ is constantly redefining itself,” said Stenn Parton, Chief Retail Officer at DJM. “With Hollywood & Highland, we at DJM and Gaw Capital are eager to seize the opportunity to create, in the heart of Los Angeles, an environment where the iconic allure of ‘Old Hollywood’ meets the modern innovation of new media.”

“Our opportunity as the new stewards is to make Hollywood & Highland a 21st century destination—one that offers visitors a piece of Hollywood that is grounded by the needs of the modern consumer,” Parton added. “A fresh design and rebrand bolstered by relevant global brands, top-of-the-line food and beverage experiences, and a state-of-the-art digital concept is merely the beginning of our plans.”

Goodwin Gaw, Chairman and Managing Principal of Gaw Capital Partners, was a pioneer in Hollywood with his purchase and redevelopment of the Hollywood Roosevelt Hotel in 1995, just one block away from Hollywood & Highland. About the acquisition, he said, “We are delighted to be partnering with DJM to acquire this iconic asset in Hollywood. Hollywood & Highland has enormous potential given its fantastic location at the gateway to new Hollywood. It is also next to Hollywood Roosevelt, our first refurbishment project that has long been recognized as an iconic, one-of-a-kind lifestyle hotel forged with distinction in Hollywood’s history. It marks an important milestone for Gaw Capital in the Los Angeles real estate market. We look forward to working with DJM to enhance the asset by leveraging the digital content revolution and innovative technology, to re-imagine this complex to become the new ‘town center for the Hollywood community’. We would also like to express our sincere gratitude to our co-investors for their tremendous support and trust us to make this transaction happen.”

Gaw Capital currently manages over US$23 billion in real estate assets globally as of 1Q19 (US$6.5 billion specifically in retail) and has invested and developed for over twenty years in unique Los Angeles assets, including the Bradbury Building, LA Football Club’s headquarter building, television and film studios, music venues, and restaurants such as Majordomo. According to Gaw Capital Managing Director Dan Lee, “Being based in LA, we’ve built amazing relationships with truly talented people, operators and companies that span various creative fields, whether it be in entertainment, food, arts or sports. We’re excited about pulling from those experiences and relationships to create something extraordinary at Hollywood & Highland. Much like how DJM has done at their properties and we have with ours, our partnership’s intent is to make Hollywood & Highland a destination where our visitors, including locals, feel they had a unique, exciting and fulfilling experience.”

Renovations are slated to begin in 2020, with completion expected in 2021.

About DJM

DJM Capital Partners, Inc. is a private real estate equity and development firm based in San Jose, California. With a core strength in retail combined with expertise in office and residential asset classes, DJM’s market knowledge and strategic acquisition of undervalued assets is represented by a current portfolio of approximately three million square feet with an estimated total portfolio value of $1 billion. For more information, please visit www.djmcapital.com.

About Gaw Capital USA

Gaw Capital USA ("Gaw USA"), an affiliate of Gaw Capital Partners, was formed in 2013 to provide services for private equity real estate fund management and separate account investments in the United States. Gaw USA through its associate, Downtown Properties, has been investing in US real estate since 1995. Currently, Gaw USA is investing its third U.S. dedicated private equity fund and manages multiple single-asset separate account investments, with over US$2.3 billion under management as of 1Q19.

Gaw Capital USA pursues a value-driven investment strategy with a strategic focus on repositioning projects located in major knowledge and innovation markets marked by a young, well-educated population and strong employment growth prospects. The firm differentiates itself through its strong reputation, its significant local network of relationships, and a successful track record of more than two decades of investing in real estate within emerging areas of US gateway and secondary cities.


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