CBRE Group Inc., one of the world’s largest commercial real estate brokerages, is moving its headquarters to downtown Los Angeles from the Westside.
The company will leave its base at Irvine Co.’s Westwood Gateway office complex, 11150 Santa Monica Blvd., where it has occupied about 8,000 square feet since 2007. The global headquarters will join the firm’s L.A. offices on the top two floors of the 26-story building at 400 S. Hope St., which one of its affiliates purchased for $238 million last year. That deal marked the largest downtown office transaction since 2008.
After purchasing the building, CBRE signed a 10-year lease for 46,000 square feet there, and will also move its L.A. regional office to the site from its offices at 355 S. Grand Ave. Financial terms were not disclosed, but lease rates average $2.08 a square foot, according to CoStar.
CBRE plans to move both offices into the 400 S. Hope building at the end of August. It has four years left on its lease at the Westwood Gateway and plans to market the space for sublease.
The Hope Street lease provided additional space for the firm to grow, and the corporate parent is taking advantage of that by moving Chief Executive Bob Sulentic, Chief Financial Officer Gil Borok and other top brass and West L.A. employees to the downtown office, which can accommodate up to 200 employees.
The move downtown marks a return of the corporate HQ, which was housed at 355 S. Fremont Ave. until 14 years ago when it moved to West Los Angeles.
The Class A 701,000-square-foot South Hope red granite tower was built in 1982 and is 89 percent leased. Tenants include O’Melveny & Myers LLP, management consulting firm McKinsey & Co. and Bank of New York Mellon Corp.
CBRE will add its name in lights to the top of the building, a perk it hasn’t had since the 1990s, and is already making renovations to turn the office space into a “creative” layout. It is a concept the firm is calling its “Workplace360” plan and a service it is also offering to its clients.
Sulentic said the open-concept office space was one factor in the move.
“CBRE’s future success is closely linked to our ability to work collaboratively and efficiently in serving our clients,” he said. “Our new downtown headquarters is being conceived, designed and built to enable us to work better, smarter and more productively in an increasingly mobile, highly connected world. In many ways, it represents the workplace of the future – for CBRE and for many of our clients.”
Portfolio Sale
A four-building, 1.2 million-square-foot portfolio of high-profile Los Angeles County office properties is trading hands in a $550 million deal.
Entities controlled by Houston’s Hines Real Estate Investment Trust Inc. have agreed to sell downtown L.A.’s One Wilshire and El Segundo office towers, occupied by defense contractor Raytheon Co. and cable television provider DirecTV to an affiliate of GI Partners LLC, a private equity firm in Menlo Park.
The sale price is equivalent to about $454 a square foot, putting it among the highest prices for office building sales in the county in the last five years, according to CoStar Group Inc.
One Wilshire, at 624 S. Grand Ave., is a 662,000-square-foot Class A data center and office skyscraper near Pershing Square in downtown.
The deal also include three adjacent El Segundo properties: 2200 E. Imperial Highway, a 200,000-square-foot Class A office building fully leased by Raytheon; 2230 E. Imperial Highway, a 200,000-square-foot Class A building fully occupied by DirecTV; and 2222 E. Imperial Highway, a 140,000-square-foot Class B office building and parking structure.
Hines acquired the One Wilshire building in August 2008 for $287 million. It bought the El Segundo buildings seven months later for $120 million.
In a filing with the Securities and Exchange Commission, Hines said it expected the sale to close next month, but that it could take until September.
Neither company returned a request for comment.
Staff reporter Jacquelyn Ryan can be reached at [email protected] and (323) 549-5225, ext. 228.
