U.S. Bank Tower Maintains Identity in Lease Deal

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The name atop the tallest skyscraper west of Chicago will remain in place for the next decade.

In the second-largest lease deal in downtown Los Angeles thus far this year, U.S. Bank has renewed for 105,000 square feet at the 73-story 633 W. Fifth St. for another 10 years.

The Minneapolis financial institution first leased space in what was then known as Library Tower in 2003, when it also acquired naming rights.

Though further terms of the lease were not disclosed, average annual rents in the building are $25.75 a square foot, according to data provider CoStar Group Inc. At that rate, U.S. Bank’s lease would be valued at more than $27 million.

The anchor tenant’s renewal in the tower was an important development for Singapore landlord Overseas Union Enterprise, which last summer purchased the property from MPG Office Trust Inc. for nearly $368 million. The 1.4-million square-foot building, now about 62 percent leased, was only about 57 percent leased at the time of sale. U.S. Bank has a ground floor presence and offices on four floors, occupying more than 7 percent of the massive high rise.

Since purchasing the tower, OUE has been quiet about its plans for the property, though there has been some speculation in recent months about what kinds of upgrades the landlord would implement. According to downtown blogger and real estate broker Brigham Yen, the company has hired downtown L.A. architecture firm Gensler to come up with ways to get more use out of the vacant portions of the building, including renovating the lobby, opening a sky deck and maybe even converting lower office levels to hotel or residential use. OUE has not yet confirmed any plans.

Mark O’Brien, Matt Renshaw and Paul Ayoob of CBRE Group Inc. represented the landlord in its lease deal with U.S. Bank.

The largest leased signed downtown this year was landscape design and architecture firm SWA Group Inc.’s 110,000-square-foot renewal for its space at 811 W. Seventh St. The 10-year deal closed in March.

Downey Deal

A medical office building in Downey sold late last month for $11.3 million.

PIH Health, a non-profit regional health care network out of Whittier, bought the five-story Brookshire Medical Building at 11411 Brookshire Ave. on April 25 from WRA Property Management Inc. of Newport Beach. The health care provider paid about $201 a square foot for the 56,000-square-foot Class B medical facility. The medical office building, built in 1970 and renovated in 2009, was listed for sale in the fall for $12.9 million.

David Black, a senior vice president of investments in the Long Beach office of Marcus & Millichap, represented the buyer in the deal. He said PIH Health saw healthy upside potential in the property.

Michael Lawrence of Marcus & Millichap’s Newport Beach office represented the seller in the deal.

Baldwin Park Plans

A 3.6 acre site in Baldwin Park where a private school and church have sat abandoned for years is under contract to be sold later this year.

San Diego investor Presidio Residential Capital, with Irvine homebuilder South Coast Communities, is in escrow to purchase the Mid Valley School site at 13940 Merced Ave. The sale price was not disclosed, but Presidio said it would spend $18.5 million, including the price of the property, to develop 51 detached single family homes on the site.

The gated community, built by a construction division of South Coast, will feature two- and three-story villas with three or four bedrooms. A community park and prominent water feature are also part of the plan.

Brent Little, principal of South Coast, said he is working now to complete entitlements for the property before Presidio closes the acquisition later this year. He hopes to begin construction early next year.

“The Los Angeles infill market is chronically underserved in nearly every community we look in – there’s tremendous demand for new residential housing,” he said.

Staff reporter Bethany Firnhaber can be reached at [email protected] or (323) 549-5225, ext. 235.

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