A partnership that includes Maguire Properties Inc. Chief Executive Robert Maguire has put a Playa Vista office development up for sale.
The Water’s Edge project at 5510 and 5570 Lincoln Blvd. has a sole tenant, video game publisher Electronic Arts Inc., which has a lease that expires in September 2013.
The two Class A buildings, constructed in 2002, total 261,870 square feet and sit on 3.5 acres of land. Brokers with knowledge of the submarket say that the property could sell in the $160 million range.
The development is across the street from the Playa Vista residential development. In the next few years the area will be transformed by several large office and residential projects, including a mixed-use development by Caruso Affiliated Holdings, which will break ground on the project at the end of the year.
The office development has been on the market for a few weeks and sources say that offers are expected by mid-October. Rental rates are spiking dramatically in Playa Vista. The average asking rent for Class A space in the Marina/Culver City market was $3.40 per foot per month in the second quarter, according to Grubb & Ellis Co. data. But recent asking rents in Playa Vista are closer to $7 per foot.
The listing agents, Kevin Shannon and Tom Bohlinger of CB Richard Ellis Group Inc., did not return calls seeking comment.
Century City Renewal
Los Angeles-based market research firm Lieberman Research Worldwide Inc. has a renewed its lease at 1900 Avenue of the Stars and will remain in Century City for the next 10 years.
The terms of the deal for 54,875 square feet of space were not disclosed but according to a broker who represented Lieberman Research, the asking rate in the 28-story, Class A building is $3.50 per foot per month.
The deal closed in September with building owner Duesenberg Investment Co., which is owned by billionaire John Anderson.
Construction began two weeks ago on a renovation of Lieberman’s space. The company is moving its reception area from the 15th to the 16th floor and will occupy half of the 15th floor and all of the 16th and 17th floors. The work should wrap up by the end of the year, said Mike Catalano, a senior vice president at Studley Inc. who represented the research firm.
During construction the firm is taking temporary space elsewhere in the building. Catalano said that Lieberman looked at other locations before deciding to stay in Century City.
“I think what was compelling was that they had a strong relationship with the ownership,” Catalano said. “People say, ‘I’ve been here 15 years, does that buy me anything?’ Typically the answer is no. In this case both parties valued each other and the value in the project.”
Elsewhere in Century City, asking prices are much higher than $3.50 a foot per month. For example, at 2000 Avenue of the Stars, the asking rate is said to be in the $6 range.
The landlord was represented by Darren Bell of Topa Management Co., another of Anderson’s companies.
Freeway-Adjacent
With rental rates on the rise and vacancies down in most submarkets across Los Angeles, brokers say that more and more users are looking to buy office properties.
This was the case in the sale of the two-story office building at 1631 Pontius Ave., just off of Santa Monica Boulevard near the San Diego (405) Freeway.
The 8,052-square-foot building was purchased on Aug. 29 by an unnamed local advertising and marketing company that operated under the Skycannic Ventures LLC.
The seller was Kaiser Family Trust, the entity of a Malibu family that used the building for its company, Kaiser Marketing. Constructed in 1972, the building sits on just about a fifth of an acre.
At $5.03 million, the sale breaks down to a whopping $625 per square foot. But that was not a problem for the buyers, said T.C. Macker of Coldwell Banker Commercial Westmac.
“With rents being so high on the Westside there is an active user market,” said Macker, who represented the seller. “At a certain point it makes sense to own rather than lease.”
Macker said that owner-users like the buyer in this deal are often willing to pay 10 percent more than what a typical owner-investor would pony up.
“That’s the case here,” said Macker, who added that there were multiple offers on the property, which went into escrow with the buyer a week after it hit the market.
Craig Miller and Jeff Lipson of Stone-Miller represented the unnamed buyer in the Pontius deal. Timothy C. Macker, T.C.’s father, also represented the Kaiser Family Trust.
Koreatown Apartments
Just as the credit crunch began rattling the local commercial real estate scene this summer, a local company unloaded a Koreatown apartment complex for $23.4 million.
A private partnership managed by Astani Enterprises Inc. sold the 104-unit building at 345 S. Alexandria Ave. to Equity Condominium, a subsidiary of Equity Residential. The deal closed Aug. 10.
The property is being converted into condominiums and has a tentative condominium tract map. Equity Condominium is likely 18 to 24 months away from beginning the condo sales process, said Ron Harris of Marcus & Millichap Real Estate Investment Services, who represented both sides of the deal.
The deal breaks down to $224,519 per unit. The apartment property is currently 60 percent occupied. Astani Enterprises has owned the building since the early 1990s.
Shane Astani of Astani Enterprises said his company decided to sell the property because an investor in the deal wasn’t prepared to pay for more capital improvements at the property. Astani Enterprises is the developer that is building downtown’s Concerto condo towers.
Staff reporter Daniel Miller can be reached at
[email protected]
or (323) 549-5225, ext. 263.
