One of the largest lease deals of the year has closed in downtown Los Angeles.
Transamerica Occidental Life Insurance Co. has signed a 10-year lease to remain at the AT & T; Center in a deal valued at about $75 million, said sources familiar with the downtown real estate market.
The lease deal on 260,000 square feet means that the three-building center will retain one of its anchor tenants at the 32-story Tower building.
“We are pleased to have Transamerica as a major tenant in the project,” said Phil Belling, managing partner at LBA Realty, the center’s owner. “We are pleased Transamerica has made a long-term commitment to the property and to downtown Los Angeles.”
However, Transamerica’s new lease will be for about 90,000 square feet less than its old lease.
But the company is not losing employees, said Jones Lang LaSalle Inc. managing director Peter Best, who represented Transamerica in the deal.
“It is streamlining and right-sizing,” Best said.
The lease begins in 2008 when Transamerica’s old lease ends. AT & T; Center, which is located at 12th and Olive streets, is currently undergoing major interior and exterior renovations, which are expected to be completed in early 2007. Interior renovations will include a new lobby, building entrances, retail space, and a food court.
These renovations helped keep Transamerica at the center, as did the complex’s proximity to downtown’s burgeoning South Park area, which features many new loft and condo projects and Staples Center, among other developments.
The lease works out to about $288 per square-foot.
Transamerica built the complex in the 1960s and was leasing the office space at a below-market rate as part of a deal it made when it sold the building to New Pacific Realty Corp. several years ago, Best said.
Best said that Transamerica looked at other markets like Burbank, Glendale, Woodland Hills and Long Beach before deciding to remain in the complex.
“They looked at all the alternatives and really feel like since they built the project in the 1960s they decided to stay with LBA,” Best said.
Best said Transamerica also stayed downtown because it was concerned with losing employees who lived near the area.
Lisa St. John and James Malone of Jones Lang LaSalle also represented Transamerica on the deal. Todd Doney and Bruce Asper of CB Richard Ellis Group Inc. represented LBA Realty.
City National Consolidates
In early 2007, City National Corp. will consolidate two of its City National Bank operations in Century City and open a new branch on the ground floor of Century Plaza Towers.
The new branch at the Century Park East complex is part of a new 25,000-square-foot lease deal the banking company has signed with the building landlord, One Hundred Towers LLC. The lease also includes non-branch office space. The value of the 15-year lease was not disclosed.
The banking company had previously occupied less prominent space in the office complex and jumped at the chance to lease “high visibility ground floor space,” said Trammell Crow Co. vice president of leasing Jeff Lasky, who represented the landlord.
“From an economic perspective it’s a fantastic deal,” he said. “It strengthens Century City and reduces vacancy. It will draw a lot of other tenants to the market.”
In its consolidation effort, City National Bank will close branches on Avenue of the Stars and a location below grade in the Century Plaza Towers, Lasky said.
“It’s a great project for City National Bank,” said Jones Lang LaSalle managing director St. John, who represented the banking company.
Brad Cox and Patti Gilbert of Trammell Crow also represented the landlord and Best of Jones Lang LaSalle also represented the tenant.
Martek Lease
Martek Power Inc., a designer and manufacturer of power supplies and DC/DC converters, has signed a lease for industrial space in Torrance.
The Torrance-based company will occupy 53,922 square feet of space at 1111 W. Knox St., an industrial building in the Pacific Gateway Center business park.
The 10-year lease deal is valued at approximately $6.5 million, said Newmark Knight Frank director Mike Fowler, who represented Martek in the transaction.
“It was a very aggressive deal for Martek,” Fowler said. “Prices are on the rise and vacancies are on the decline. It’s a very tight market.”
The deal breaks down to $121 per square-foot and Fowler said Martek was attracted to the site because of the company’s specific needs abundant parking and heavy electrical power capabilities.
“The building was heavily improved ahead of the lease deal,” Fowler said.
Martek will occupy the new space in January after consolidating operations at three other California locations.
Rick Merritt of Newmark Knight Frank also represented Martek on the deal.
Terry Reitz, Gerald Kim, Jim Biondi and Chris Sinfeld of Grubb & Ellis Co.’s Torrance office represented the landlord, Prudential Real Estate Investors, in the transaction.
Staff Reporter Daniel Miller can be reached at (323) 549-5225, ext. 263, or
[email protected]
.
