Downtown
Downtown’s office vacancy rate tightened in the fourth quarter to 15.9 percent, down from the third quarter’s 16.3 percent and the previous year’s 17.2 percent. Average Class A asking rents rose to $3.70, up 12 cents over the previous quarter and 19 cents over the previous year. Net absorption was 130,159 square feet, and 116,000 square feet were under construction.
Main Events
• The Chicago School of Professional Psychology signed a lease to relocate its Los Angeles campus to the Aon Center at 707 Wilshire Blvd. in a 10-year, 5-month lease valued at $15.7 million.
• Insurance broker Lockton Inc. has leased 70,000 square feet at the 777 Tower at 777 S. Figueroa St. for an undisclosed amount, moving from the nearby Ernst & Young Plaza.
• The CalEdison, a well-known art deco building downtown, has been refinanced in a deal pegged at more than $100 million. New York-based GreenOak Real Estate acquired an interest in the building from a joint venture partnership managed by Houston-based Lionstone Group.
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Hollywood
Hollywood’s office fourth quarter vacancy rate decreased to 9 percent, down from 10.5 percent in the previous quarter and 14.8 percent the previous year. Class A asking rents decreased to $5.53, down 42 cents from the previous quarter but up $1.06 from the previous year. Net absorption was just over 1,000 square feet while 978,177 square feet were under construction.
Main Events
• Souferian Group Inc. sold a 92,000-square-foot office building at 1800 N. Highland Ave. to the Related Cos. for $72.1 million.
• Los Gatos-based Netflix Inc. signed two high-profile leases in Hollywood. The first is an 11-year lease for the 328,000-square-foot Epic building at 5901 Sunset Blvd. owned by Hudson Pacific Properties that will be completed in 2020. The second is for all 355,000 square feet of Kilroy Realty Corp.’s Academy on Vine project, which Netflix will move into in 2020.
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Westside
The Westside office vacancy rate was essentially flat at 13.2 percent, down incrementally from 13.3 percent the previous quarter and 14.8 percent the previous year. Culver City had the highest vacancy rate at 21.9 percent, far below its 29.7 percent vacancy rate the previous year. Class A asking rents on the Westside were $5.24, down 3 cents from the previous quarter but up 23 cents from the previous year. Net absorption was 515,954 square feet. More than 1 million square feet were under construction, including nearly half a million square feet in Culver City.
Main Events
• LPC West, a subsidiary of Lincoln Property Co., and Broad Street Principal Investments purchased the Entrada, a planned 300,000-square-foot office space project in Culver City on undisclosed terms from Woodbine Legacy Investments.
• Asana Partners purchased the grocery-anchored center Balcony at Beverwil for $50.3 million from O’Hearn/Hillcrest Properties.
• A joint venture led by Crown Equity purchased 457-459 N. Rodeo Drive from Lang & Lang Properties for $96 million, or $8,240 per square foot.
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Santa Clarita Valley
Santa Clarita Valley’s office vacancy rate fell to 14.1 percent from 14.4 percent the previous quarter but increased from 11.4 percent the previous year. Class A asking rents were $2.84, down 4 cents from the previous quarter but up 6 cents over the previous year. Net absorption was 7,864 square feet. There was no office property construction during the quarter.
Main Events
• Monteverde Development sold the Plum Canyon Development Site to Intertex General Contractors for $5 million, according to data from CoStar Group Inc.
• Nutritional supplement company Lief Organics leased a 112,000-square-foot property at 28903 Avenue Paine in Valencia on undisclosed terms.
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San Fernando Valley
The San Fernando Valley’s office vacancy rate climbed to 12.7 percent, up from 12.5 percent the previous quarter and 11.7 percent the previous year. Class A asking rates were $2.78, down 17 cents from the previous quarter, but up 1 cent year over year. Net absorption was negative 3,900 square feet. Roughly 218,000 square feet were under construction.
Main Events
• Bolour Associates Inc. purchased a 50,0000-square-foot building at 21200 Oxnard St. in Woodland Hills from One Lambda Inc. for an undisclosed price.
• Kilroy Realty Corp. sold the Calabasas Park Center, a roughly 225,000-square-foot office campus in Calabasas, for $78.2 million to a joint venture between Related Fund Management and Cruzan.
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Tri-Cities
Fourth-quarter office vacancies decreased to 14.3 percent from 15.8 percent the previous quarter, an increase from last year’s 13.6 percent. Class A asking rates were $3.31, up 8 cents quarter over quarter and 18 cents year over year. Net absorption increased to 349,746, up from last quarter’s negative 129,108 square feet. There were no office projects under construction during the fourth quarter.
Main Events
• Morton Development Group purchased the vacant Artistry Theater Building at 600 E. Colorado Blvd. in Pasadena for $5.3 million from Colorado Creative.
• Beacon Capital Partners has purchased a 527,340-square-foot office tower at 800 N. Brand Blvd. in Glendale from Piedmont Office Realty Trust Inc. for $160 million.
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Wilshire Corridor
Wilshire Corridor’s fourth-quarter office vacancy rate rose to 20.9 percent from the previous quarter and the previous year’s 19.8 percent. Asking rents rose to $3.17, up 3 cents from the third quarter and up 12 cents from the previous year. Net absorption remained negative at 83,703 square feet. There was no construction during the quarter.
Main Events
• Mid-Wilshire-based CIM Group Inc. purchased the Desmond, an 11-story office and retail building at 5500-5528 Wilshire Blvd. from Toronto-based Brookfield Asset Management Inc. for $24.6 million.
• CIM Group Inc. sold The View, a 168-room apartment building at 3460 W. 7th St. in Koreatown to M West Holdings for an undisclosed sum.
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South Bay
The vacancy rate in the South Bay’s industrial market increased to 1.7 percent, up from 1 percent last quarter and 1.2 percent the year previous. Asking rents were $1, up 2 cents from the previous quarter and 10 cents from the previous year. About 2.2 million square feet sold or leased and 1.6 million square feet was under construction.
Main Events
• Radiology Partners Inc. has signed a 10-year, $33 million lease for 65,000 square feet at a Frank Gehry-designed project called Ascend at 2330 Utah Ave. in El Segundo.
• Newport Beach-based Redwood Partners Ltd. purchased The Hubb, a creative space at 100 W. Broadway in Long Beach for $60.5 million from Ocean West Capital Partners and Singerman Real Estate.
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San Gabriel Valley
The San Gabriel Valley’s fourth-quarter industrial vacancy rate increased to 2.1 percent up from 2 percent the previous quarter and 1.8 percent the previous year. Asking rents were $0.79, up 3 cents from last quarter and 7 cents year over year. Roughly 3 million square feet was sold or leased and 2.6 million square feet was under construction.
Main Events
• Glendale-based Fox Chase Partners Ltd. purchased an 83,703-square-foot office building at 1333 S. Mayflower Ave. in Monrovia for $18.5 million from the Kare Foundation.
• Cal State LA signed a lease for roughly 12,000 square feet at Ratkovich Co.’s The Alhambra on undisclosed terms.
