In what would be Los Angeles County’s largest office sale in eight years, the Wilshire Courtyard complex, home to E! Entertainment, Oprah Winfrey Network and the Business Journal, is close to trading hands.
Tishman Speyer Properties LP of New York bested other interested parties with a $423 million bid to purchase the nearly 1 million-square-foot, two-building property from owner RREEF, a member of Deutsche Bank Group. The global real estate investment arm of the Frankfurt, Germany-based bank purchased the 5700 Wilshire Blvd. office complex for $378 million in 2005.
Brookfield Office Properties Inc. spent $435 million in 2004 before the recession when it bought downtown L.A.’s Bank of America Plaza at 333 S. Hope St. However, at roughly $425 a square foot, the Wilshire Courtyard deal is much larger on that metric. The bank plaza went for about $288 a square foot.
The sale also tops the $238 million Tishman garnered in July when it sold its 400 S. Hope St. building to CBRE Global Investors, at that point the county’s largest office sale this year.
Patrick Inglis, vice president at Jones Lang LaSalle Inc.’s downtown office and who was not involved in the deal, said he believes the Wilshire Courtyard sale signifies improvement in the county’s market for higher-quality office buildings.
“A well-positioned Class A asset like this, trading for this price point, shows there’s demand from investors to be in Los Angeles,” he said.
Tishman and RREEF, both of which declined to comment, are working up a purchase contract for the Wilshire property, but the timeline for closing the transaction is not clear.
RREEF had originally only marketed a minority interest in the Wilshire Courtyard building, but after receiving significant interest for the entire property, opened a quiet bidding process that Tishman ultimately won.
This will be Tishman’s eighth property in its L.A. portfolio, which includes the 325,000-square-foot Campus at Playa Vista and the 185,000-square-foot UTA Plaza in Beverly Hills.
Kilroy is Here
Kilroy Realty Corp. is expanding its media-related office portfolio in Los Angeles.
Last week, the West L.A. real estate investment trust acquired Columbia Square, at 6121 Sunset Blvd in Hollywood, and will close on the purchase of Tribeca West, at 12233 W. Olympic Blvd in West Los Angeles, this month. The acquisitions total roughly $138 million.
In August, the company acquired Sunset Media Center, 6255 Sunset Blvd., for $76 million.
David Simon, executive vice president at Kilroy, said that the company aims to become a media- and tech-focused landlord.
“This continues to build the platform for Kilroy to offer solutions for entertainment and media tenants,” he said. “The acquisition of Tribeca is going have a lot of synergy with (Sunset Media Center) and Columbia Square.”
Columbia Square was sold by New York real estate investment trust iStar Financial Inc. The building was home to CBS radio and television productions for decades but now is only a little more than 50 percent occupied by production companies.
Kilroy plans to spend $300 million to update the historic 121,000-square-foot office building and develop about 550,000 square feet of additional space for offices, residences and shops. The project, already entitled, will be completed in phases over the next several years.
Tribeca West is being sold by Ocean West Capital Partners in Santa Monica. The 151,000-square-foot office complex is nearly fully occupied by postproduction companies. Kilroy plans to operate the recently renovated building as is.
Locally, Kilroy also owns Westside Media Center, where it has its headquarters, and tenants that include Shopzilla Inc., Fandango and Comcast Corp.
College application processor XAP Corp. has moved its headquarters into new Culver City offices.
The company signed a seven-year lease for 14,757 square feet at 100 Corporate Pointe with Slauson Investors LLC of downtown Los Angeles. Financial terms were not disclosed but CoStar Group Inc. estimates the firm has a monthly rent of $2.25 a square foot.
XAP provides online tools to explore careers and apply to colleges and universities. It processes more than 3.5 million college applications and 1.5 million transcripts annually.
The company had been in almost 20,000 square feet at 3534 Hayden Ave. in Culver City for nearly 15 years. However, its lease there was expiring at the end of August and it was looking to reduce costs. XAP signed its deal in July for the Corporate Pointe location, a three-story, nearly 110,000-square-foot building.
Corey Spound, an executive vice president at Jones Lang LaSalle Inc. who represented XAP, said that the new lease came together quickly.
“They were able to achieve all their objectives and saved 50 percent in terms of their occupancy cost, without giving up much real estate,” he said.
Blake Searles at Jones Lang LaSalle also represented XAP. The landlord was represented by Eric Adams and Steve Solomon, also of Jones Lang LaSalle.
Staff reporter Jacquelyn Ryan can be reached at email@example.com or (323) 549-5225, ext. 228.
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