New details about a terrorist plot to fly a jetliner into L.A.’s U.S. Bank Tower may have rattled the nerves of some tenants, but downtown boosters are contending the news won’t have a lasting impact.
In a speech last week, President Bush revealed new details of the planned 2002 attack by Al Qaeda on the building, which at 72 stories, is the tallest building west of the Mississippi River.
The 1.37 million square-foot building, which is close to 85 percent occupied and was formerly known as Library Tower, has long been on a list of probable L.A. terrorist targets and the Al Qaeda attack had been revealed several years ago.
“You don’t hear anybody worried about it or really talking about it,” said Carol Schatz, president and chief executive of the Central City Association, a downtown business lobbying group. “And with all the companies we’re trying to bring downtown, I’ve never heard (terrorism) as an issue.”
Maguire Properties Inc., the owner and co-developer of the building, has substantially increased security in the building since the Sept. 11, 2001, terrorist attacks on New York and Washington, D.C., according to company spokeswoman Peggy Moretti.
“The safety and security of our tenants is of paramount importance,” Moretti said in an e-mail. “We are in regular communication with various local and federal agencies to ensure the utmost protection of our people and our assets.”
Meanwhile, many tenants in the building said they had known about the Al Qaeda threat and understood the building would likely remain a terrorist target.
“We’ve always believed that the building was a terrorist target even if we were never explicitly told so,” Brenda Imes, chief compliance officer with Clark Consulting, told Bloomberg News. “It’s an icon, it’s the tallest building out here.”
Brokers who specialize in representing tenants in downtown office buildings, including the Library Tower, maintained that terrorism concerns wouldn’t likely make their clients want to leave downtown either.
Increased security measures and procedures that have been put into place at most premiere downtown office towers have re-assured many tenants, said Joshua D. Gorin, a senior managing director in the downtown office of Studley
“Unfortunately, the reality of circumstances have created new perspectives and resiliency to these types of threats,” Gorin said in an e-mail. “The impression I have from existing tenants is that the heightened security creates a sense of comfort and our clients are happy to be here.”
High-Priced Hollywood
The latest Hollywood office building transaction has set a new high-water mark, putting the submarket’s prices on par with recent sales of Westside properties.
The owners of the Los Angeles Film School and the Los Angeles Recording School bought the 100,000-square-foot Klasky Csupo building at 6353 Sunset Blvd. for $40 million, or about $400 a foot.
Full Sail Real World Education, the owners of the Film and Recording schools, plan to expand the film school operation into the new building and also to relocate the recording school into the structure from a few blocks away.
Buying the Klasky Csupo building is the second recent building purchase for the school. In December 2004, Full Sail Real World Education purchased the building at 6363 Sunset Blvd., where the school has been operating for the last six years.
“The building acquisition not only represents our ability and willingness to expand in an effort to provide superior education, but this extraordinary building offers a remarkably creative and artistic environment,” said Diana Derycz-Kessler, who serves as the schools’ chief executive. “It truly captures the spirit of our institutions.”
The $400-a-foot pricetag is a $140 a foot increase from the prior record. In August, the House of Blues office building was sold to CB Richard Ellis Investors for $83 million, or about $260 a foot.
Early last year, CIM Group Inc. paid $227 a foot for the Stephen J. Cannell building at 7083 Hollywood Blvd. and ScanlanKemperBard Cos. paid $170 a foot or $37 million in June 2004 for the CNN building at 6430 Sunset Blvd.
Portland, Ore.-based ScanlanKemperBard recently put its CNN Tower back on the market. At the new high-water rate, the roughly 200,000-square-foot building at 6430 Sunset Blvd. could be worth $80 million.
Vacancy rates at Hollywood office buildings dropped to single-digits by the end of last year from nearly 20 percent three years earlier. At the end of December, average asking rents in Hollywood were $2.54 a foot, while during the same period a year earlier the rents were 10 cents a foot cheaper.
Staying Put
Mayer Brown Rowe & Maw LLP renewed its lease at the 52-story Two California Plaza in a deal worth $25 million.
The law firm inked a 10-year deal to continue taking 77,282 square feet in the building at 350 S. Grand Ave., where it has a staff of 71 attorneys. The 1.3-million-square-foot property on downtown L.A.’s bunker hill is owned by Chicago-based Equity Office Properties Trust.
Mayer Brown Rowe & Maw was represented in the transaction by the Staubach Co.’s John McRosky, Whitley Collins and Frank Scott. EOP was represented internally.
*Staff reporter Andy Fixmer can be reached by phone at (323) 549-5225, ext. 263, or at
[email protected]
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