A 215,097-square-foot office tower at 801 S. Grand in downtown has sold for approximately $46 million.
Newmark Group Inc.’s Kevin Shannon, Ken White, Rob Hannan, Laura Stumm, Michael Moll, and Alex Beaton represented the seller, CIM Group, on the sale to buyer Elat Properties.
“[The sale of 801 S. Grand] got done ahead of the new Mansion Tax, which was an important driver,” Shannon said in a statement. “These transactions clearly demonstrate the tremendous basis advantage available for contrarian investors, which will allow them to be extremely competitive to attract new tenants.”
Officially known as Measure ULA, the “Mansion Tax” was voted in by Angelenos to raise millions for affordable housing and homelessness programs by implementing an additional 4% tax on properties that sell for $5 million or more and 5.5% tax on properties selling for $10 million or more. Contrary to the “Mansion Tax” moniker, the taxes apply to all asset classes including apartment complexes, retail, industrial buildings and other commercial real estate properties.
The tower at 801 S. Grand was 74% leased at the time of sale to a diverse tenant roster with a weighted average lease term of 5.4 years. It was built in 1986 and renovated in 2014. It sits on 1.35 acres and features 11 stories of office space, 594 parking stalls and more than 8,000 square feet of retail space.
The property is near the 110 freeway and blocks from the 7th Street Metro station. It is directly adjacent to Whole Foods Market and within proximity to L.A. Live, Crypto.com Arena and numerous retailers and restaurants.