San Jose Mayor Matt Mahan is leveraging significant financial support from the Los Angeles real estate sector as he campaigns for governor of California. Recent contributions include a $10,000 donation from Bill Witte, chairman emeritus of Related California, bringing Witte’s total contributions to Mahan to $20,000. Witte had previously donated to candidate Antonio Villaraigosa.
Mahan’s campaign has seen a substantial influx of capital from industry figures, collecting more than $1 million via Rick Caruso. Other donors providing thousands of dollars include Victor Coleman, Jordan Kaplan, Jason Oppenheim, Angela Aman, and D. Michael Van Konynenburg.
Despite this financial backing, Mahan continues to poll generally in the single digits following his late entry into a crowded race, although a poll commissioned by the mayor placed him at 10 percent. Observers of recent debates have described Mahan as “almost too normal,” noting a lack of standout moments, though he is credited with fielding questions skillfully and remaining calm while emphasizing his role as mayor of the state’s third-largest city.
Debating the Future of Downtown Los Angeles
The state of downtown Los Angeles became a focal point in a recent exchange between Mayor Karen Bass, Councilwoman Nithya Raman, and Spencer Pratt. When asked if the city could afford to let downtown “die,” none of the candidates denied that the area was in decline.
Councilwoman Raman proposed bringing city workers back to their desks more than three days a week, preventing businesses from fleeing, and improving safety and cleanliness. Spencer Pratt highlighted the lack of safety in the area, claiming Raman does not care about safety and that Bass “at least pretends to care.” Mayor Bass stated that the city cannot afford to let downtown die.
Financial Distress at Oceanwide Plaza
New financial reports for the bankrupt and unfinished Oceanwide Plaza development reveal a significant deficit. As of March 31, the three-tower project reported total assets of $565 million, with real property valued at approximately $434 million, against liabilities and debt totaling $781 million.
The complex continues to generate no revenue while incurring expenses, resulting in monthly losses of $745,000. Total losses since entering bankruptcy court appear to be $21 million. A hearing to confirm a $470 million purchase of the property by Lendlease and KPC, primarily via a credit bid, is scheduled for later this month after the city requested more time.
L.A. REIT Earnings and Market Shifts
Quarterly earnings calls for Los Angeles Real Estate Investment Trusts (REITs) show a mixed landscape of recovery and ongoing losses.
- Douglas Emmett: The company reported its highest number of leases over 10,000 square feet to date, with tenants from the legal and entertainment sectors. CEO Jordan Kaplan noted that Los Angeles “feels like it’s coming back.” Kaplan revealed he was “frightened” when Warner Brothers vacated Studio Plaza, leading the company to conduct a multimillion-dollar renovation in 2025 to transition the site into a multitenant office campus.
- Hudson Pacific Properties (HPP): The studio and office owner reported a quarterly loss of $53 million, though this is an improvement over the previous year. CEO Victor Coleman is working to eliminate a “Quixote earnings drag.” HPP and Blackstone are currently in discussions with their lender regarding a billion-dollar maturity due this summer. The company has secured a buyer for 10950 Washington Boulevard in Culver City.
Television City Rumors
Market reports indicate that a group of lenders led by Deutsche Bank is recruiting a broker to market Hackman Capital Partners’ Television City. While rumors have surfaced suggesting that Rick Caruso may be eyeing the property, Caruso has neither confirmed nor denied these reports. Notably, Caruso’s mall, the Grove, is currently suing to block the expansion of Television City.
