Rockwood in talks to buy creative office in Playa Vista
Rockwood Capital is in talks to acquire Water’s Edge, a creative office campus in Playa Vista owned by DivcoWest and Maguire Partners. The pending sale price for the 260,000-square-foot campus, which is home to Electronic Arts, is roughly $190 million, sources said. That would pencil out to about $735 per square foot.
The campus consists of two buildings across 6.5 acres, marketing materials show. The sale would include development rights for a third, 130,000-square-foot building that is already part of the Water’s Edge master plan.
Maguire constructed the two existing buildings in 2002. The 195,200-square-foot office at 5510 Jefferson Boulevard is 88.3 percent leased, according to data from CoStar Group. In addition to Electronic Arts’ 84,000-square-foot lease, the building is also home to Popchips, Doner and Pop Media Group. The second building, at 5570 Lincoln Boulevard, is fully leased and is anchored by L.A. Fitness. Eastdil Secured had the listing.
Tesla charges into Marina del Rey’s Omnicom building
Tesla is expanding in Los Angeles — fittingly, to a location right next to the freeway.
The electric car company, led by Elon Musk, signed a lease for the entire former Omnicom building at 4729-4755 Alla Road in Marina del Rey. The deal, signed in October, gives Tesla 131,000 square feet of space across the four-story property, which sits on four acres of land near the 90 Freeway and the ocean. Tesla’s lease runs at least seven years and is valued at about $30 million, sources said.
The property, last renovated in 2000, is owned by Pacific Properties Group — a partnership led by Black Equities Group, according to CoStar Group. It has been vacant since 2015, when ad agency Omnicom moved to Playa Jefferson. Sources speculated Tesla’s Marina del Rey lease could be for a repair center, a delivery point or a production facility. While the company has a showroom in nearby Santa Monica, it lacks a delivery point in the area for the Model 3 cars it is planning to roll out, sources said. Having a repair stop near the highway would reduce long wait times for parts.
Local law has developers worried about building in L.A.
Development costs have skyrocketed in Los Angeles in recent years, as construction and land prices rise in a region notorious for land use challenges. And now, a voter-approved law has developers worried about building in the city.
A group of prominent developers, gathered on Oct. 13 at the California Club for an LAHQ panel, said Measure JJJ will only compound the impacts of the construction labor shortage. The law requires developers to pay construction workers prevailing wages and set aside a percentage of affordable units.
“We are not going to build anywhere in L.A. for at least two years,” said Paul Keller, the CEO of Mack Urban, which is building the second phase of a $1.2 billion development with AECOM Capital in South Park.
Keller said the land and the labor are simply too expensive. “Unless subcontractors start yielding and landowners start yielding,” he said. “Something has got to give.”