Deal Near on Sale of Westwood Bullocks/Macy's Project
Real Estate by Danny King
Madison Marquette appears to have found a buyer for its Bullocks/Macy's redevelopment in Westwood Village.
The firm received more than a dozen offers for the 212,000-square-foot project, redubbed Westwood Marketplace when it went on the market in June, and is said to be close to a $70 million deal, according to real estate sources.
Though the buyer has not been identified, bidders were said to include London-based Grosvenor Land Holdings PLC, RREEF and LaSalle Investment Management.
Neither officials from Madison Marquette nor Eastdil Realty, which is listing the property, would comment on the process.
Madison Marquette entered into a ground lease on the 52-year-old property with Federated Department Stores Inc. in 1999 and bought it outright last August, shortly before completing its renovation. The project is fully leased, with Home Depot Expo, at 98,000 square feet, as its largest tenant. The center also includes a Ralphs Fresh Fare, Best Buy and Longs Drugs.
The lofty price is more a reflection of great demographics and a booming investment market than of the center's performance, according to Matthew May, president of May Realty Advisors.
"No one is hitting the sales figures they expected," said May. "But you've got good credit tenants everywhere and it's a hot market. (Madison Marquette) is going to make a lot of money."
Tech Out, Law In
One of the new economy's formerly hot addresses is opening its doors to more traditional tenants to fill yawning dot-com space.
Law firm Liner Yankelevitz Sunshine & Regenstreif LLP signed a 10-year lease for 40,000 square feet at Arden Realty Inc.'s Westwood Center at 1100 Glendon Ave. and will be moving from its Santa Monica offices. The deal was valued at about $16 million.
The 313,000-square-foot building, previously known as the Monty's building, was renovated in early 2000 and, with tech firms like Liberty Digital and PeopleSupport.com signing on, had filled up by May 2000.
"Construction was finalized during the boom time of technology, so it became a favorite tech building," said Blake Mirkin, first vice president at CB Richard Ellis who, with Insignia/ESG Inc.'s Hunt Barnett, represented the tenant.
Since then, several tech firms have folded, moved out or reduced space, raising vacancies. Before the Liner Yankelevitz deal, the building was about 30 percent vacant.
At about $3.30 a foot, the Liner Yankelevitz deal is about 35 cents less than the deals made by the tech firms two years ago. The average Class-A asking rent in Westwood for the second quarter was $3.25, down from $3.60 for the year-earlier quarter, according to Grubb & Ellis Co.
Mark Robinson, corporate managing director for Julien J. Studley Inc., said Arden is being aggressive in chasing down deals for the property. "That vacancy won't stick around for long."
Arden's Gayle Landes and First Property's Mike Gellar represented Arden on the deal.
Kilroy Realty Corp. is gradually filling the 156,000 square feet vacated by eToys at Westside Media Center.
Immortal Entertainment Group signed a five-year deal for 24,000 square feet at the Olympic Boulevard project's second phase. The deal was worth about $4 million.
With the Immortal deal sealed, 42 percent of the second phase is now spoken for, with an additional 30,000 square feet expected to be signed within the next couple months, according to Hunt Barnett, senior managing director at Insignia/ESG and a leasing agent for the property. Kilroy moved its corporate headquarters to the site in May, taking 31,000 square feet in the process.
The idea of buying in an owner-user building is a big plus for tenants, as opposed to having a big East coast landlord, said Barnett.
The activity comes as Kilroy wraps up Phase 3 and begins dropping rents.
"The project didn't hang together as well until the third phase was completed," said Barnett, who, with Insignia's Rick Buckley and Chris Houge and Kilroy's Kathy Delgado, represented the landlord. "We decided to go out and chase some deals some of the other buildings haven't been as aggressive in doing so."
One of the last parcels of land owned by the late City Council President John Ferraro has been sold to a Van Nuys-based investor.
Selective Real Estate Investments bought the 3.6-acre parcel that includes the Woodland Hills Main U.S. Post Office for more than $2 million. Ferraro bought the property at 22121 Clarendon St. in the early '60s and built the 30,000-square-foot post office facility.
"There are a couple more (that haven't been sold), but I'm not certain of the status of the others," said Gary DiMartino, partner at Told Partners. DiMartino represented both the seller, Ferraro Family Trust, and the buyer on the deal.
Selective Real Estate, which owns 1.5 million square feet of commercial property, mostly in the Sacramento and Fresno areas, has no immediate plans to develop the rest of the site.
"It's possible (for us to develop), but not for a while," said Brian Fagan, managing partner at Selective.
Three months after leaving his five-year post at Trammell Crow Co., real estate veteran Peter Best has landed at Jones Lang LaSalle.
Best has taken a position as managing director at Jones Lang LaSalle and will begin work there Sept. 1. His primary goal is to expand the profile of the company, the 16th largest in deals brokered in the county last year.
"There was an opportunity to be a player-coach," said Best, who spent 12 years at Grubb & Ellis before joining Trammell Crow. "My goal is to make sure everyone knows about this company."
Best, who had been principal and head of leasing at Century Plaza Towers at Trammell Crow, left the company in early June, shortly after Bradley Cox came over from Cushman & Wakefield Inc.
"Brad's a great guy to have on any team," said Best. "It was just time for me to move on."
Staff reporter Danny King can be reached at (323) 549-5225 ext. 230, or at firstname.lastname@example.org.
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