How much are those mouse ears worth? Quite a bit, it seems, to real estate investors.
Palo Alto-based Menlo Equities bought Buena Vista Plaza, a 116,000-square-foot office property in Burbank that is almost entirely leased to Walt Disney Company for $52.5 million in a deal that closed last week, The Real Deal has learned.
The real estate investment firm paid roughly $456 a square foot for the fully-occupied building at 2411 West Olive Avenue. The seller was TIER REIT, a publicly-traded company based in Dallas, Texas.
Todd Tydlaska, Louay Alsadek, Mike Longo, Sean Sulivan and Doug Marlow of CBRE represented both sides of the deal.
Menlo purchased the property for the cashflow from Disney’s lease, which was renewed in 2015 and does not expire until 2026, sources said. Linda Lee of Charles Dunn Company leased the property.
TIER acquired it for $32.9 million, or $286 a square foot, in 2005. Its take-home in the sale to Menlo soars above recent Burbank comps. Goldstein Plating Investments bought an office at 2835 North Naomi Street in Burbank, for example, for only $241 a square foot in Dec. 2016, CoStar shows. Atlantic Pearl Investments acquired the Burbank Airport Center office building a year earlier for just $220 a square foot.
“[Buena Vista Plaza] is one block away from Disney’s studio so the buyer had confidence they will remain there for a long time,” Longo said. “The sale demonstrates buyers’ interest in credit-backed tenants.”
Menlo’s portfolio includes properties in Cupertino, Santa Clara and Palo Alto, but it is no stranger to Burbank. The company, run by Henry Bullock and Rick Holmstrom, developed an 18-acre office park at 2400 and 2350 Empire Avenue in 2002. It sold the property, which is part of the 103-acre Burbank Empire Center, to CBRE in 2005. UBS then bought the buildings for $80 million in 2015.