Sunday, March 22, 2026

Pasadena Bank Finances Wave of Office-to-Housing Conversions Across L.A. County

East West Bank’s lending to developer Izek Shomof coincides with the city’s own push to turn vacant offices into homes.

East West Bank, the Pasadena-headquartered bank and lender that last month purchased a 270,000-square-foot office building on Colorado Boulevard for $98 million, is financing a series of projects to convert vacant office buildings into housing across Los Angeles County, the bank said in a company article published Wednesday.

The bank’s lending to developer Izek Shomof — who has filed plans to turn office towers in Long Beach and Glendale into more than 700 residential units — comes as Pasadena itself contends with an office vacancy rate nearing 25% and works to implement adaptive reuse zoning amendments the City Council approved in September 2024 to encourage similar conversions.

East West Bank has provided construction financing, acquisition loans and other banking services for Shomof’s projects, according to the company’s article. The bank said it helped finance Shomof’s purchase of a 24-story Long Beach office tower with a $25 million loan in 2025.

“COVID fundamentally changed the commercial real estate landscape,” said Robert Lo, executive vice president of commercial and real estate banking at East West Bank. “Office vacancies increased dramatically, and in some cases property values fell as much as 80% to 90%. Adaptive reuse allows developers to convert those buildings into housing and bring people back into downtown districts.”

Described by the bank as “a longtime pioneer of adaptive reuse redevelopment,” Shomof has spent more than two decades converting aging office buildings in downtown Los Angeles into residential communities. His projects along Spring Street include City Lofts, Spring Tower Lofts, Premier Tower Lofts, Milano Lofts and Panorama Tower, the article said.

His latest projects target buildings acquired at steep discounts from their pre-pandemic valuations. Shomof bought the 24-story Landmark Square at 111 W. Ocean Blvd. in Long Beach for $50 million last fall — a fraction of its $135.5 million purchase price in 2013 — and has filed an application with the Long Beach Planning Bureau to convert the nearly 480,000-square-foot building into 391 residential units, according to The Real Deal, a real estate trade outlet.

In Glendale, Shomof purchased a 19-story office building at 101 N. Brand Blvd. for $58.5 million, which the bank’s article described as “less than half its value from a decade earlier.” Urbanize LA reported that Shomof has filed plans to convert the building into 312 units. He also acquired 617 W. Seventh St. in downtown Los Angeles for $20.5 million, which the bank’s article described as “roughly half its previous valuation.”

Separately, East West Bank in February purchased Western Asset Plaza at 385 E. Colorado Blvd. in Pasadena from the Irvine Company for approximately $98 million, according to trade sources. The Irvine Company had purchased the five-story office building in 2012 for $144.5 million. An East West Bank spokesperson told CoStar the acquisition “provides flexibility for future expansion as the bank continues to grow and reflects our long-term commitment to Pasadena.” The bank is headquartered nearby. The bank (as yet) has not announced plans to convert the building to housing.

The prominent P:asadena purchase places East West Bank at the center of a broader shift taking shape on Pasadena’s commercial corridors.

The city has 13.9 million square feet of office space, with vacancy rates that peaked at 26.8% during the pandemic before settling to 19.8%, according to a recent City of Pasadena planning presentation.

But Lee & Associates’ Tri?Cities (Glendale–Burbank–Pasadena) Q3 2025 office report shows a Tri?Cities vacancy rate of 25.8%, and specifically notes that this level is driven in part by “major Pasadena trades” such as 800 E. Colorado Blvd. and 55 S. Lake Ave., implying that Pasadena’s submarket is likely near that mid?20% level as of late 2025.

So far the city has seen compldetion of just one major office-to-residential conversion to date: an office building at 388 E. Cordova St. that was transformed into 66 housing units and commercial space between 2019 and 2021.

To encourage more conversions, the Pasadena City Council voted in September 2024 to approve zoning code amendments that streamline the process — including updated density allowances, parking flexibility and simplified review procedures.

“This has been a long time coming,” Mayor Victor Gordo said at the time.

The trend is gaining traction across the region. Los Angeles adopted its Citywide Adaptive Reuse Ordinance effective February 2026, allowing commercial buildings at least 15 years old to be converted to housing by right. The city’s original 1999 adaptive reuse rules, which applied mainly to downtown, helped produce more than 12,000 housing units, according to city records.

The bank’s article noted that policy changes are reducing regulatory barriers to housing development statewide, though challenges remain. The article said that higher interest rates have increased financing costs, tariffs have raised construction material prices, and California’s development impact fees for multifamily and single-family housing are three times the national average.

“These projects are complicated,” Lo said in the article. “Developers want a bank that understands the process and can structure the right financing solution.”

Lo said the bank draws on decades of experience in adaptive reuse lending.

“The story looks great when the building is finished,” he said. “But getting there takes the right partners.”