HKS Capital Partners brokers ground lease for Simon Baron Development's new L.A. hotel asset

Los Angeles, CA HKS Capital Partners, a Manhattan-based financial advisory firm, brokered a 99-year-ground lease on the Stay on Main Hotel in Downtown L.A. for a top New York developer who is making moves on the West Coast. “This is the first time HKS Capital has brokered a 99-year-lease,” said HKS partner Ayush Kapahi who closed the deal for Simon Baron Development together with HKS partner Jerry Swartz for about $15 per s/f per year.    “This shows the resources HKS Capital has beyond financing capital markets,” said Kapahi. “We have done major finance deals for this developer and we were pleased to help them on this deal in another important way to bring his project to fruition.” The deal is Simon Baron’s first foray into the L.A. market. The company, led by Jonathan Simon and Matthew Baron, previously focused on developing multi-family properties in the New York region and currently controls properties worth a cumulative $1.7 billion. It plans to reposition the 170,000 s/f budget hotel by completing a significant capital improvement program.  “We plan to use this project as a catalyst to begin more projects on the west coast, more specifically, in the greater Los Angeles area,” Baron said in a statement. “Downtown L.A. is transforming into a major developed area and undergoing a renaissance… We are looking forward to contributing to that.” The hotel sits in an area that real estate developers used to shy away from, but luxury development has moved closer to Skid Row’s borders in recent years,  In New York, Simon Baron recently purchased a site at 12 Franklin Street in Greenpoint, Brooklyn for $24 million, which HKS Capital Partners also financed.  Besides the leasehold closing, HKS has already closed out north of a $150 million in deals for the month of May.