A mere three months after Google leased its former “Spruce Goose”airplane hangar in Playa Vista, developer Ratkovich Company is making moves to sell the property and several adjacent buildings.
The four buildings, collectively known as the Hercules Campus, are expected to sell for up to $300 million. Together, they will span 525,000 square feet after Google completes its buildout.
Under its 16-year lease, Google is paying $11 million in rent every year for the properties. That’s about 50 percent below the average asking rate in Playa Vista, REAlert reported, attributing the discount to the fact that Google is spending an additional $250 million to build out the complex to its specifications. HFF has the listing.
Hercules has an additional 194,000 square feet of space, nearly half of which is also occupied by Google and its affiliates.
Buyers will have to embrace the prospect of a long-term relationship with Google. As part of the current lease agreement, the company’s rent will increase by 3 percent annually. Google also has the option of three 5-year lease extensions and the option to buy the property at a five percent capitalization rate after its first lease ends.
Google inked the hangar lease in June, The Real Deal reported, while also buying an adjacent plot of land from Lincoln Property Company. That parcel is zoned for almost 900,000 square feet of office space. [REAlert] — Cathaleen Chen