Coretrust Capital Partners may soon have a trophy Downtown Los Angeles property on its hands. The firm is in advanced talks to buy the 48-story Citigroup Center at 444 South Flower Street for roughly $340 million, or $382 a square foot, The Real Deal has learned.
The firm could not be reached for comment, but sources said it intends to invest in a renovation program and will redo the lobby. Improvements will be aimed at fully leasing the 891,100-square-foot property, which is 74 percent occupied, below the DTLA average of 82.5 percent.
Stephen Somer, Stephen Silk and Jay Borzi of Eastdil Secured are representing Hines in the sale to Coretrust, sources said, but the brokers could not be reached for comment. Representatives of Hines and Coretrust also could not be reached.
Hines stands to make a significant profit on the property, which it acquired in 2008 for $275 million, or $309 a square foot, from Beacon Capital Partners, according to CoStar. It listed the property with Eastdil earlier this year, seeking a reported $350 million.
The founders of Coretrust have a history of restoring skyscrapers Downtown. The company was formed in 2014 by Thomas Ricci, Randall Scott and John Sischo, three former Thomas Properties Group executives. Under Jim Thomas’ leadership, Thomas Properties Group gave the property kitty-cornered to the Citigroup Center a $125 million facelift, restoring the downtrodden property at 555 South Flower to prominence in the skyline. Now, it seems, former executives of the company are looking to do the same across the way.
“I think the market will take this ownership well because of the association with what is now known as the City National Center, but was then the Arco Center,” said Nico Vilgiate of Colliers, who is not involved with the Coretrust deal but has worked on leases at the Citigroup Center. “[444 South Flower] is a core asset in the center of Downtown. The center has arguably been shifting South, but [Flower and 5th] is still one of the main intersections.”
The Citigroup Center has a futuristic Equinox and a storied history of appearing onscreen. Developed in the 1980s, the building was featured in the opening credits of “L.A. Law” and was the setting of the major gun battle in the Al Pacino and Robert DeNiro movie “Heat.”
Major tenants include Citigroup, Morgan Stanley, Freddie Mac and the U.S. Securities and Exchange Commission.