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Wednesday, May 18, 2022

West Coast Data Hub One Wilshire Gets $389M Loan

One Wilshire, a data center in downtown, has received a $389 million refinancing loan.
Data centers are tech hubs that house stacks of computers that store and process data.

Goldman Sachs Group Inc. provided the 10-year, fixed-rate loan to borrower San Francisco-based GI Partners. The nonrecourse, full-term, interest-only loan will be used to pay off GI Partners’ current loan and return a portion of the equity.
One Wilshire, at 624 S. Grand Ave., is a 661,553-square-foot, multitenant property largely considered a data center hub for the West Coast due to its large fiber-optic network.

It has five utility power risers and 13 generators with 24-hour fuel storage.
The property is 30 stories tall and is 89% leased.
Jones Lang LaSalle Inc.’s Kevin MacKenzie, Brian Torp, Jake Wagner, Samuel Godfrey and Darren Eades arranged the financing on behalf of GI Partners.
“As one of the largest internet exchanges in the world, One Wilshire is truly a best-in-class asset recognized as the premier telecommunications hub of the Western United States,” MacKenzie said in a statement.

“GI Partners has done an excellent job managing the asset to maximize utilization and creating significant value. We were able to bring together a cross discipline team to secure the optimal results for our client, and all parties involved worked tirelessly to accomplish the goal of closing on a short timeline before year-end,” he added.
Data centers like One Wilshire have seen a lot of demand in recent years. In the first half of 2021, the L.A. market absorbed 7 megawatts, a 250% increase over 2020 absorption levels. That came after a 25% increase from 2019 to 2020.

In 2020, 160,000 square feet and 9 megawatts of data center space was under construction in L.A. County, according to JLL. That space has since opened. Many data centers in the county, like West 7 Center at 1200 W. 7th St., are located downtown though ones are located in El Segundo.
JLL expects demand, which is being driven in part by increased reliance on cloud services and L.A.’s large population, to continue.

Data centers hold large amounts of power and fiber, have to be earthquake-safe, need to have high ceilings to stack servers and need large holding weights. Most data centers are purpose builds as a result and not conversions because of the necessary requirements.

Hannah Madans Welk
Hannah Madans Welk
Hannah Madans covers real estate for the Los Angeles Business Journal. A USC grad, Madans has done work with publications including The Orange County Register, The Real Deal and doityourself.com.

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