Two creative office buildings in Playa Vista have sold, totaling approximately $75 million.
The properties include The Annex, a 132,000-square-foot low-rise creative office campus that sold for $50 million, and 12901 W. Jefferson Blvd., a 48,400-square-foot single-tenant creative office building that sold for roughly $25 million.
Newmark Group Inc. represented the seller, LaSalle Investment Management – an operationally independent subsidiary of global real estate services company Jones Lang LaSalle Inc. – in both transactions.
“The sale of both assets is a reflection of the increased liquidity we are seeing in the market, especially in a desirable submarket like Playa Vista where investors and users can obtain today a comparatively very attractive basis,” Kevin Shannon, Newmark co-head of U.S. capital markets, said in a statement.
Shannon worked alongside Newmark’s vice chairs Ken White, Rob Hannan, Laura Stumm and Michael Moll on the transactions.
Located in Playa Vista’s so-called “Agency Alley,” The Annex offers tenants a fully renovated low-rise campus which can accommodate a variety of creative uses, offering editing bays, sound stage production space, exclusive patios and private entrances.
Situated on just over five acres of land, the property includes the opportunity to add density via the development of an additional 160,000 square feet.
The building was purchased by the Westside Neighborhood School, a local preschool-8th grade private coeducational school. David Kimball and Sam Devorris of NAI Capital represented Westside Neighborhood School in the sale. It is unclear what the school wishes to do with the property.
Meanwhile, 12901 W. Jefferson Blvd. was purchased via a joint venture between Brentwood-based development and management company Pacshore Partners and Beverly Hills-based private investment firm A2 Capital Management. It is fully leased to media giant Interpublic Group, serving as the headquarters for two of its major media companies – Deutsch LA and Steelhead.
Playa Vista has emerged as an epicenter for technology and media growth and is defined by the rapid expansion of some of the most dynamic tenants in entertainment, technology, media and content creation, according to Newmark.
Still, the market has faced some difficulties. In the first quarter the office vacancy rate for Playa Vista was 30.4%, up from 24.8% the previous year, according to data from Jones Lang LaSalle Inc. The vacancy rate in the first quarter was higher than the county average of 27.3%.
The office asking rent in Playa Vista for the first quarter was $6.32 a square foot for Class A space, nearly $2 more than the county average, according to JLL data. There was no new office product under construction in the area during the quarter.
