Determining Highest & Best Use

PROBLEM

A partnership owns this 6.59 acre property located in Mission Hills. The site is underutilized and has existing zoning restrictions, transitional height zones and other encumbrances that prohibit certain types of development. The partnership wanted to know what the highest and best use on the site would be given these restrictions.

SOLUTION

LAA principals and team members were hired to develop a strategy to engage multiple types of developers on the site including; multifamily, senior housing, retail and medical office, to determine the highest and best use on the property. LAA performed field work and interviewed multiple developers and the City and determined residual land value based on the market variables such as; market rent, construction costs, entitlement timeframe, and site layout.

OUTCOME

The team took the information collected from the field study and the developer interviews and determined that the highest and best use for the property was either: (a) multi-tenant retail (given the property’s location along the highly trafficked Sepulveda Blvd corridor) or (b) medical office (given the property’s location less than a mile away from the hospital).