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Douglas Emmett buying 1299 Ocean for roughly $290M: sources

JV with QIA is in talks to acquire 429 Santa Monica, too
By Hannah Miet | March 08, 2017 07:12PM

Dan Emmett of Douglas Emmett, Jonathan Gray of Blackstone and the building at 1299 Ocean Boulevard

It’s hard to outbid Douglas Emmett.

The company, known for paying top dollar and holding assets long-term, is in contract to purchase the Wilshire Palisades building for about $287 million, or $1,400 a square foot, sources told The Real Deal. If the deal to purchase the property from Blackstone Group closes, it would be the highest per-square-foot sale price in Santa Monica’s history.

Other bidders for the 11-story, 205,000-square-foot, ocean-facing property at 1299 Ocean Avenue included Boston Properties, sources said. But Douglas Emmett (DEI) blew the pack away by offering a stiff premium – when TRD wrote about the building being shopped around last month, sources familiar with the property said they expected it to trade for about $238 million, or $1,165 a square foot.

The deal is expected to close in the coming months, sources said.

The mega-landlord’s joint venture partner on the deal is Qatar Investment Authority, sources said, but this could not be confirmed. QIA, the sovereign wealth fund of Qatar, was DEI’s joint venture partner on a $1.34 billion acquisition of a Westside office portfolio from Blackstone last year.

DEI is also in talks to acquire the 86,700-square-foot office at 429 Santa Monica Boulevard from Blackstone for more than $73.7 million, or $850 a square foot, sources said. QIA is said to be a partner on that deal as well. 

Eastdil Secured has the listing for Wilshire Palisades but its brokers could not be reached for comment, nor could HFF’s Ryan Gallagher, Andrew Harper, and Michael Leggett, the brokers marketing 429 Santa Monica.

The current per-square-foot price record in Santa Monica is $1,165, set by Oracle’s purchase of 2700 Colorado late last year.

DEI could not immediately be reached for comment. Blackstone declined to comment.