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7/22/24
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An 80k sf creative office/retail building in Downtown Los Angeles' historic core traded hands in a $16 mil ($200/sf) transaction. The six-story structure is located at 612 S. Broadway.
Originally built in 1924 as Desmond's Department Store and designed by the renowned architect A.C. Martin, 612 S. Broadway stands as a testament to LA's architectural heritage. The building underwent a comprehensive redevelopment, transforming it into a state-of-the-art creative office space while preserving its historical essence. This ambitious project, overseen by local architect firm Omgivning, included adding two new floors atop the original structure, further enhancing its utility and aesthetic appeal.
The redevelopment project was completed and delivered fully preleased in 2020, with Skechers securing the ground floor retail space and a coworking concept occupying the majority in the remainder of the building. However, the timing coincided with the onset of the COVID-19 pandemic, presenting unforeseen challenges.
Despite these headwinds, the building's potential was recognized by a private investment group that identified a unique buying moment in the market, to acquire a trophy asset at below replacement value. The buyers are a local family office that intend on moving their operations into the space.
Mike Condon Jr., Erica Finck, Reid Gratsch, Brittany Winn, and Kylie Rawn with Cushman & Wakefield, in partnership with Mark Zakarian, represented the seller in the transaction.
“The sale of 612 S. Broadway is not an isolated success. It highlights a broader trend of recovery and renewed interest in Downtown LA. Notably, UCLA's recent acquisition of 433 S. Spring further demonstrates this resurgence, with significant investments reflecting confidence in the market's future,” noted Condon Jr.
The acquisition and occupancy of 612 S. Broadway symbolizes more than just a real estate transaction; it marks a new chapter in the building's storied history and a hopeful future for Downtown LA. As the area continues to attract prominent businesses and institutions, the outlook for this historic submarket, also known as SOBRO, is increasingly optimistic.
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