In the Wilshire Center market, stretching eastward from La Brea Avenue to Koreatown, a strong influx of new tenants hasn't yet translated into higher asking rates.
Net absorption totaled 68,967 square feet in the third quarter, up from 46,458 square feet in the April-June period.
"The significant positive absorption is the result of the national economy improving," said Zaya Younan, chairman and chief executive of Younan Properties Inc. "That allows people to expand their operations through hiring, inventory and more space per individual."
Vacancies fell to 10.9 percent after holding at around 12 percent for six consecutive quarters. Yet average asking rates remained steady. Class-A rates ticked up one penny from the second quarter to $1.41 per square foot, equal to the like year-ago period. Class-B asking rates were unchanged sequentially at $1.30, up from $1.27 in the year-ago quarter.
The most significant lease deal involved Westwood College of Technology, in a 10-year, 40,000-square-foot transaction worth $6.1 million at 3250 Wilshire Blvd. The college relocated from 3460 Wilshire Blvd.
Advertising firm McDonald & Associates renewed and expanded it lease at 4221 Wilshire Blvd., taking 10,913 square feet of office space for three years at undisclosed terms.
There were several large owner-user sales, at prices Grubb & Ellis Vice President Chris Runyen said were historic highs.
Class-B buildings at 818 S. Berendo St., 2140 W. Olympic Blvd. and 3330 Wilshire Blvd. traded hands at prices between $1.6 million and $8.7 million. And in the Class-C market, Public Counsel Inc. bought 30,452-square-foot 610 S. Ardmore Ave. from AMFM Broadcasting Inc. for $3.6 million.
One of the highest-priced deals of the quarter was an investment transaction for the Class-C medical building at 639 S. New Hampshire Ave. Haeri LLC bought the 21,088-square-foot property earlier this year for $2.3 million and flipped it in the third quarter to Jin H. Suh for $3.5 million with no improvements. "That's a 50 percent gain in less than a year," Runyen said.
And at 4500 Wilshire Blvd., the Hill Family Trust sold a 13,565-square-foot Class-B building to 4500 Wilshire LLC 13 for $3.9 million.
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