New York’s Clarion Partners just bought the historic Eastman Kodak site in Hollywood from Lincoln Property Co. for $61.3 million in an off-market deal, The Real Deal has exclusively learned. Clarion paid almost $600 a square foot for the campus Lincoln redeveloped, a price which sources say is roughly on par with pending sales in the increasingly attractive office market.
The property was renamed the Hollywood Media Campus after Lincoln’s extensive renovations. It now encompasses 102,800 square feet of creative office space at 6700 Santa Monica Boulevard and 1017 North Las Palmas Avenue. The site became fully leased last year when film and TV services company SIM Group signed a long-term lease for 65,000 square feet of office, production and post-production space.
Lincoln will continue to manage the property, said David Binswanger, Lincoln’s executive vice president. It will profit from property management fees, in addition to the money it made selling the site, which it acquired for only $24.5 million in 2013, or $29.5 if you count the money it spent on renovations.
Nicole Mihalka of JLL represented Lincoln Property Co. in the sale to Clarion. Both Mihalka and a representative of Clarion Partners could not be reached for comment.
This isn’t the first time Clarion has purchased a property after it was reimagined by Lincoln. In 2010, Lincoln developed the i|o at Playa Vista campus at 12130 Millennium Drive. It sold it vacant to Clarion in 2014 to the tune of $133 million. At i|o, Lincoln continued to manage and lease the property, nabbing Jessica Alba and Brian Lee’s Honest Co. as 90,000-square-foot tenants.
Lincoln has done well locally with value-add and ground-up development projects it started over the past four years, selling them more recently in a market where capital is anxious to acquire. Just yesterday, The Real Deal reported that Lincoln was under contract to sell the Desmond in Downtown Los Angeles to AEG for $48.5 million.
Clarion, for its part, had a strong motive to invest in Hollywood. Overall rental rates for Class A projects in the Hollywood/Silverlake office submarket were $4.21 a square foot a month in the fourth quarter, a solid increase from $3.59 in the same period a year earlier, according to a report from Savills Studley. Rents are highest at the newest creative office projects, like Kilroy Realty Corp.’s Columbia Square complex, and, well, the Hollywood Media Center.
The site also plays a part in Hollywood’s history. In the late 1920s, Eastman Kodak scientists at the site developed the company’s first film with sound.
On Jan. 22, global asset manager Legg Mason agreed to acquire a majority equity stake in Clarion for $585 million.
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