CommonWealth Partners LLC has listed its entire $1.7 billion portfolio of 13 properties, including the 53-story tower at 777 Figueroa St. and three Glendale office buildings, according to sources who have seen the listing.
L.A.-based firm CommonWealth, which owns its properties through a partnership with the Rockefeller Group International Inc. and the California Public Employees Retirement System, has listed the roughly 6 million-square-foot portfolio with Secured Capital Corp.
The portfolio's Los Angeles County properties include the 1-million-square-foot 777 S. Figueroa St. with land entitled for an 850,000-square-foot office, residential or hotel building and in Glendale, 801 N. Brand Blvd., 700 N. Central Ave. and 200 Burchett St., which is entitled for a second 150,000-square-foot office building.
There are also three properties in Orange and San Diego counties with a cumulative 1.5 million square feet, along with 3.1 million square feet worth of office buildings in Denver, Phoenix, Honolulu and Texas.
Officials at Secured Capital, CommonWealth Partners, the Rockefeller Group and Calpers didn't return messages.
Bill Boyd, a senior vice president with Grubb & Ellis Co., called the listing the most significant disposition of Glendale office buildings since the early-1990s.
Many consider 801 N. Brand with its all-granite exterior and high-quality construction to be one of the premier addresses in Glendale, Boyd said. "I can't imagine a listing of this size, it's so dramatic," he said.
The Rockefeller Group, a subsidiary of Mitsubishi Estate Co., purchased a 70 percent stake in CommonWealth for $50 million in November 2003. Last July, CommonWealth bought 777 S. Figueroa St. and its entitled land from Mitsubishi Estate Co. for $250 million.
In mid-December, Calpers announced the $177 billion pension fund would scale back its real estate holdings by 1 percentage point to 8 percent. The move is intended to allow the fund to sell some of its properties to take advantage of the sizzling real estate market.
Year of the Landlord
While 2004 will likely be remembered for the fireworks on the sales side of commercial real estate, this year may be marked by an increase in leasing activity, according to an L.A. County office forecast by Grubb & Ellis.
By the end of 2004, many L.A. County submarkets were posting strong absorption levels and lower vacancy rates, which allowed landlords to begin asking higher rents.
Landlords will likely become bolder with asking rents through 2005, according to J.C. Casillas, research director for Grubb & Ellis' L.A. office.
"These rent increases should become more evident and pronounced across the L.A. Metro region," Casillas wrote in the forecast. He said submarkets with low vacancy rates specifically North County, Tri-Cities and Wilshire Center could turn to a landlord's market.
With rates hovering at $2.40 a foot for much of 2004, Casillas wrote that average L.A. County asking rents have already flattened and reached their bottom level. However, until activity begins to pick up at the end of this year, he doesn't expect rents to spike.
"The market should not experience any fluctuations through the first half of 2005," he wrote.
Though rents may take six months to increase, landlords are already cutting back on tenant improvements dollars allotted in a lease to tenants for use fixing up office space.
Those concessions are expected to nearly disappear in tight office markets in Pasadena and the North County, where vacancy levels should finish in single digits by the end of the year, according to the forecast.
"Landlord concessions diminished in the last half of the year, and are now only found in select buildings and submarkets," Casillas wrote.
End of the Century
BentleyForbes has closed on the previously reported sale of 21st Century Plaza to J.P Morgan Flemming Asset Management for about $130 million, according to President and Chief Executive David W. Cobb.
The deal marks one of the largest of 2004 for the Warner Center in Woodland Hills, where the two 11-story towers account for 517,000 square feet of Class A office space. Both sides were represented by CB Richard Ellis Inc.
BentleyForbes is in the midst of selling off several of its key office and retail assets to "rebalance its portfolio," Cobb said. The firm is currently marketing two portfolios worth more than $500 million with properties across the U.S. One is composed of Class A office buildings and a second is made up of warehouse and industrial facilities.
Included in that "rebalancing" were several new hires, including Cobb. Most recently, the firm hired Michael Navarro to be its senior vice president of asset management. Navarro was hired away from Maguire Properties Group Inc., the publicly traded L.A.-based property owner, where he oversaw the management of 1.2 million square feet of office properties, new development and underwriting.
William "Bill" Anderson has resigned from the real estate company his billionaire father John Anderson owns.
Effective Dec. 9, Bill Anderson left Topa Management Co., where he had worked alongside his father for 14 years learning the ropes of the real estate business.
Bill Anderson said he and an unnamed partner have founded National Beverage Properties Inc., which will focus on buying and managing beverage distribution warehouses.
"The difficult thing for any second generation member in a family business is that it's very hard to feed your own entrepreneurial spirit," he said. "I came to a point in my career where I had an exciting opportunity and I really wanted to start my own company."
While dabbling in everything from insurance to private clubs, Topa manages more than 4 million square feet of commercial space and about 4,500 residential units in California and Hawaii.
John Anderson said he is supportive of his son's decision. "He's trying to start his own business," John Anderson said. "I wish him well."
Staff reporter Andy Fixmer can be reached by phone at (323) 549-5225, ext. 263, or by e-mail at email@example.com .
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