The California Marketplace auction has once again led to a change in ownership, marking the second time in five years that the LA Koreatown shopping center has been sold due to financial distress. Located at 450 South Western Avenue, the 83,000-square-foot retail complex was auctioned on March 5 for $29.2 million after its previous owner, Jake Sharp Capital, defaulted on debt, according to The Real Deal.
![: California Marketplace shopping center in Koreatown, Los Angeles, recently sold in an auction amid financial struggles. [Screenshot]](https://www.koreadailyus.com/wp-content/uploads/2025/03/0314-CAMarket.jpg)
A History of Financial Trouble
Originally built in 2016 by Hyunsoon Lee, CEO of California Marketplace, the shopping center has faced ongoing financial difficulties. During construction, the project encountered severe debt issues, which later escalated.
In January 2020, developers filed for Chapter 11 bankruptcy to delay repayment on $20 million in outstanding debt. By May 2020, the U.S. Bankruptcy Court approved the property for a bankruptcy sale. Later that year, in December 2020, the Jake Sharp Group acquired the shopping center for $57.5 million, with Lee remaining as an investor.
However, after five years, the financial troubles resurfaced. As a result, the lender reclaimed the property through the latest California Marketplace auction.
Vacancy and Market Challenges
Real estate analysts cite high vacancy rates and declining profitability as the main reasons for the repeated financial struggles. While California Marketplace remains open with various beauty shops and restaurants, many storefronts are empty. Additionally, some tenants have reportedly fallen behind on rent due to weak sales.
The commercial real estate market downturn, coupled with the prolonged economic impact of COVID-19, has made it increasingly difficult for retail businesses to remain profitable. Following the second foreclosure, Hyunsoon Lee is now completely removed from managing the property, according to industry sources.
Future Uncertainty and Business Challenges
Industry experts believe the new owner may attempt to find a third-party buyer. However, skepticism remains about whether major Korean investors will be interested, given the shopping center’s history of foreclosures, auctions, and bankruptcy.
A local real estate expert stated, “The Koreatown business district is struggling, and the rental market remains weak. Without a new business strategy, the shopping center will continue to face challenges.” Some suggest transitioning away from a traditional retail model toward a more diversified business approach to ensure long-term sustainability.
Current Operations
Despite the ownership change, California Market, the grocery store inside California Marketplace, continues to operate as usual. Meanwhile, lease renegotiations with existing tenants are expected under the new ownership.
BY EUNYOUNG LEE [lee.eunyoung6@koreadaily.com]
