DMG World Media and the Hertz Group plan to sell the California Market Center to Jamison Properties of Los Angeles for $135 million, with closing expected by the end of January 2005.

DMG will end its management of the center, which started in August 2001 with its master lease agreement with the Hertz Group. Two years ago, DMG bought 20% of the three-building complex in downtown Los Angeles from Hertz. Jamison Properties, headed by Dr. David Lee, had approached the Hertz Group about buying the building, which was not on the market for sale. Jamison owns about 70 properties in Los Angeles and has its own management group.

California Market Center General Manager Paul Lentz said he will continue operations in a "full-speed ahead" mode through the January markets and until he's told otherwise. "It's absolutely business as usual and we're expecting a great January gift show and a great January apparel show," Lentz said.

"The sale of the California Market Center was basically the result of the majority shareholder bringing us a deal," said Fred Barnes, DMG executive vice president, gift sector. "They're real estate entrepreneurs. We're not; we're an operator. They're the 80 percent shareholders and they wanted to move on. We didn't want to remain in the project on our own so we sold.

"From a management standpoint, we're disappointed that we won't be involved because we saw some things that were definitely improving," Barnes said. "Our understanding is the new owner is going to continue the building with the same purpose it has right now."

California remains an important marketplace for DMG. George Little Management still has the management contract to run the California Gift Show and that will not change, Barnes said.

"The selling of the building will bring no changes to the show at the convention center," Barnes said. "The two are totally unrelated other than they are run at the same time and we have been doing joint marketing efforts. We own 100% of the show and only owned 20% percent of the building. We're still going to cooperate with the building as much as the new owner would like us to."

The CMC has signed long-term leases for three major new showrooms — Madden Corp., Ohio Wholesale and Off & Best Inc.

Paul Lentz