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10/02/24
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Union Bank Plaza, a 40-story office/retail tower located at 445 South Figueroa St in Downtown Los Angeles, has traded hands in a recent transaction valued at $80 mil. The 700k sf high-rise was acquired by Washington Capital Management on behalf of Southwest Carpenters Pension Trust, who intends to occupy a portion of the building and stabilize the balance of the building via lease-up.
Situated adjacent to Los Angeles’ 110 Fwy, the tower sits on one of the largest parcels in Downtown Los Angeles, spanning a full city block across 3.6 acres. It provides building-top signage visible to over 300,000 cars per day.
The property consists of 674.7k sf of office space over 27.2k sf of ground floor retail. It recently underwent nearly $65 mil of renovations, which included upgrades to the lobby, courtyard, conference center and plaza, along with overall building and tenant improvements.
Newmark Co-Head of U.S. Capital Markets Kevin Shannon, Vice Chairmen Ken White, Rob Hannan, Laura Stumm and Michael Moll, Executive Managing Director Bill Bloodgood, Senior Managing Director Chris Benton and Managing Director Anthony Muhlstein, as well as Co-President of Global Debt & Structured Finance Jonathan Firestone represented the seller, W/B Union Plaza Holdings LLC. Newmark also the buyer in the deal.
W/B Union Plaza Holdings purchased Union Bank Plaza from KBS in March 2022 for $110.5 mil, but reduced its basis substantially after receiving a large lease termination payout from Union Bank after the company merged with US Bank and relocated to US Bank Tower.
"This was a win-win transaction for the buyer and seller,” Shannon said. “The buyer acquired an institutionally renovated office tower at approximately $100 per square foot, factoring in the value of the substantial adjacent development parcel that provides future upside potential. The buyer will also occupy a significant portion of the building, effectively fixing their long-term operating costs. This is a massive discount to replacement cost and peak pricing of approximately $500 per square foot. The seller also received a substantial return, given the greatly reduced cost basis due to the Union Bank lease buyout."
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