Downtown L.A. entertainment giant Anschutz Entertainment Group signed a lease last week for the entire office portion of the historic five-story Desmond building in downtown’s South Park district, according to real estate sources.
The deal, for which terms were not disclosed, came a little more than a year after landlord Lincoln Property Co. purchased the 78,500-square-foot industrial building and adjacent parking lot for $16.3 million. The company said it would spend an additional $9 million to convert it to Class A creative office space with an on-site restaurant and nightclub.
The building, at the corner of Hope and 11th streets, is two blocks from the Staples Center and L.A. Live. Constructed in 1917, its first use was as a dealership for Ohio automaker Willys-Overland Motor Co., but it is better known for the many decades it served as a warehouse for now-defunct department store chain Desmond’s.
The building is thought to be an opportunity for AEG to consolidate its many offices around town. The entertainment company currently leases about 37,300 square feet in Miracle Mile at 5700-5750 Wilshire Blvd. and about 29,400 square feet downtown at 865 S. Figueroa St. A portion of the Wilshire lease expires in the spring and the Figueroa lease expires in December 2015.
Lincoln has said it expects to complete construction on the Desmond building before the end of this year.
Brokers for Lincoln and a spokesman for AEG declined to comment on the deal.
Carson Renewal
Sony Corp., which has for 15 years leased a large warehouse in Carson, recommitted last month to the area – at least for the short term.
The Japanese multinational renewed its lease at 2201 E. Carson St. for about 522,000 square feet for two more years. Its previous lease had expired. The deal, one of the largest by square footage in Los Angeles County so far this year, was valued at more than $6.7 million, according to real estate sources. Only a lease for 615,000 square feet signed earlier this month by deep-discount retailer 99 Cents Only Stores Inc. was larger.
Sony uses the Class B industrial warehouse to distribute electronics, primarily big-screen TVs. The 1987 building also houses corporate and customer service employees in about 25,000 square feet of office space.
Rooney Daschbach, a senior director in the Long Beach office of Cushman & Wakefield Inc., represented landlord Morgan Stanley in the deal. He said Sony signed a short-term lease because the company thought it might need more space in coming years.
“They didn’t want to commit to long term, but it was a good outcome for both the landlord and the tenant,” he said. “The landlord was willing to be flexible on terms and we’re happy to keep Sony as a tenant.”
Steve Bohannon of Cushman & Wakefield also represented the landlord, and Jeffrey Morgan and Nathan Piehl of DTZ represented the tenant.
Long Beach Buy
Long Beach Logistics Center, an industrial distribution building in the South Bay, sold last month for $16.5 million, or nearly $88 a square foot.
Seal Beach developer Xebec Realty Partners sold the 188,000-square-foot Class B industrial property at 100 W. Victoria St. to CenterPoint Properties of Oak Brook, Ill.
The distribution center, which sits just off the 710 freeway about 10 miles from the Port of Long Beach, was fully leased at the time of sale to logistics company Shipco Transport Inc. The building, constructed in 1956 as a warehouse, had in the last several years been renovated to better accommodate distribution services.
Jeff Smart of Colliers International and Steve Sprenger of Newmark Grubb Knight Frank represented both the buyer and seller in the deal.
CenterPoint, a major investor in supply-chain properties near airports, rail yards and ports, was attracted to the building’s modern and efficient design, Smart said.
“This building fit their buy criteria because of its proximity to our ports,” he said. “It also has some very good loading, yard and what we call through-put capacity: the ability to move large amounts of goods through the property.”
Comings and Goings
Beverly Hills real estate data firm Meyers Research, an affiliate of Kennedy Wilson Holdings Inc., has named Todd Teta vice president of mobile technology and strategy. In that role, he will lead efforts to expand and update Zonda, the company’s housing data iPad app. Teta joined Meyers from Irvine analytics company CoreLogic Inc., where he served in a similar role as a vice president. … Design firm Gensler has named John Adams, Barbara Bouza and Michael White co-managing directors of its downtown L.A. office. With the promotion, the three longtime principals will together lead the 475-person office.
Staff reporter Bethany Firnhaber can be reached at [email protected] or (323) 549-5225, ext. 235.
