The local office buying spree rolls on as three big deals illustrate.

Aggressive Boston-based real estate investment trust Beacon Properties Inc. has followed up last November's $133 million acquisition of the 24-story Saban Plaza in Westwood with the $99.4 million purchase of the tower's "sister" highrise the 24-story tower known as Wilshire at Westwood.

Both properties were purchased from Swiss Bank, which had taken the black-glass towers back from fallen real estate syndicator VMS Realty five years ago.

The price Beacon paid for the 534,000-square-foot Wilshire at Westwood tower, about $186 per square foot, was less than the nearly $250 a foot the REIT paid for Saban Plaza last year.

One factor behind the difference is that Wilshire at Westwood's occupancy rate, 86 percent, is a bit behind Saban Plaza's 89 percent at the time of the purchase. Another is that Beacon doesn't own the land beneath Wilshire at Westwood; it is leasing that land from Metropolitan Life Insurance Co. under a ground lease that expires in the year 2069.

Beacon West Coast Acquisitions Director Tom O'Connor noted that Wilshire at Westwood stands to benefit in the near-term because of an improving L.A. Westside marketplace, and because the building's last three floors undergoing an asbestos-abatement program are near the top of the tower and will be custom built-out for tenants, once they are leased.

The tower's three biggest tenants are investment house Oppenheimer & Co., which has building-top signage, the new Americast telephone-line data transmission consortium, and Pardee Construction.

"The property is well-positioned to take advantage of the expected tightening of the Westside real estate market and rental rate increases we anticipate will occur over the next 24 months," O'Connor said.

Owning two premier highrises along the Westwood skyline "gives (Beacon) critical mass on the Westside," he added.

Hines Interests L.P., which has been leasing and managing both the former Swiss Bank towers and oversaw major renovations at both, represented the bank in the sales negotiations as well. O'Connor said Beacon is seeking additional acquisitions in Southern and Northern California.

Equitable sale

West of downtown L.A., in the struggling Wilshire Center district, a group of mostly Korean-American investors headed by Dr. David Lee has acquired the landmark 32-story Equitable Plaza Wilshire Center's biggest office building.

Both the buyers and seller, RREEF Funds, were represented in the sales negotiations by The Seeley Co.'s Laura Sparks and David Norcott, who said their clients are declining to disclose the price that Dr. Lee's group paid for the 630,488-square foot tower.

However, knowledgeable Mid-Wilshire real estate brokers estimated that the property sold for $35 million.

An institutional fund managed by the big advisory outfit RREEF had purchased the tower in 1980 for about $46.5 million, according to L.A. County property records.

Over the last three years, Dr. Lee, a practicing physician based in Van Nuys, and his partners have become the biggest office landlords in the once-thriving area also known as Koreatown and Wilshire Center.

Dr. Lee and his associates had accumulated an office portfolio approaching 1.2 million square feet which now jumps some 50 percent with the Equitable Plaza acquisition.

The management affiliate of the Lee-led JPB Investments group is now handling the property.

Universal takes Texaco tower

Last but certainly not least, a 50-percent ownership interest in another of L.A.'s most recognizable and most valuable office towers has quietly traded hands.

The 36-story 10 Universal City Plaza Tower rising just east of the Hollywood (101) Freeway at the north end of the Cahuenga Pass is now owned outright by Universal Studios Inc., which was known as MCA Inc. until early this year.

Universal and Getty Oil jointly developed the 740,000-square-foot, diamond-shaped tower in the early-1980s to house Getty's local offices and other tenants.

The tower rose on Universal-owned land near the famed Universal Sheraton before Universal CityWalk and the Universal Hilton were developed.

But even before the landmark highrise's completion, Texaco Inc. bought Getty and thus became Universal's partner in the project.

Texaco also agreed to a master lease for about three-fourths of the tower's total office space for 20 years, a lease which expires in the year 2004.

Essentially, that means the oil giant has been collecting rent from itself and other tenants on the master-leased floors and, in turn, has made regular housing payments to the Universal/Texaco joint venture at a pre-determined rate.

The joint venture has collected rents from the sterling roster of tenants in the balance of the tower as well.

In the wake of the sale of its 50-percent interest in the tower, Texaco still makes those master-lease payments. But now the checks are made out to Universal alone.

So just how much did Universal pay for Texaco's share of the income-producing property?

Universal and Texaco aren't talking, but some might call it a $64 million question or $74 million.

Actually, it's probably somewhere between those two figures, according to estimates from knowledgeable sources.

Clearly, "10 UCP" ranks among Southern California's top office properties given not only its quality and visibility but the strength of the marketplace in which it is situated.

Texaco currently occupies 250,000 square feet and subleases the balance of its master-leased portion to other tenants.

Universal occupies at least 100,000 square feet at the tower. And a roster of professional and entertainment firms round out the tenant roster.

While Universal was undeniably the most logical buyer for Texaco's interest, informed sources say at least one investment group had approached Texaco about purchasing the company's stake in the tower.

However, Universal exercised a long-standing right of first refusal and now owns the tower lock, stock, and barrel at what some real estate sources say is quite a bargain.

Brad Berton covers real estate for the Los Angeles Business Journal.

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