Olive Hill teams with Artemis on $120M Santa Monica office recapitalization

The building is fully leased to tenants including WeWork and Goodwin Procter

Artemis' Richard Banjo and Olive Hill’s Tim Lee with the property
Artemis' Richard Banjo and Olive Hill’s Tim Lee with the property

Olive Hill Group and Artemis Real Estate Partners have teamed up to recapitalize a six-story office building off the Third Street Promenade, The Real Deal has learned.

Sources said the recapitalization is worth $119 million. The companies announced the deal Monday, but declined to disclose the value. Artemis assumed Olive Hill’s existing debt on the property, a source added.

Located at 520 Broadway, the property spans 112,750 square feet. The building was recently brought to full occupancy when law firm Goodwin Procter leased 20,500 square feet. Other tenants at the building include WeWork, Boston Private Bank and Flywheel Sports.

Tim Lee, principal at investment firm Olive Hill, said it was the first time the company had partnered with Artemis.

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Olive Hill, based in Downtown L.A., paid seller Tishman Speyer $117 million to acquire the Class A office building in December 2017. At the time, the building was 82 percent occupied.

Its newest partner, Washington D.C.-based Artemis, is an investment management firm that specializes in commercial real estate. The firm recently invested $155 million for a 95-percent stake in another WeWork-occupied building in New York, known as the Ironworks.

Commercial space in Santa Monica continues to command some of the highest rents in the city, given its tight vacancy rate and rising interest from technology tenants. In March, StarPoint Properties sold the ground underneath an office building on Ocean Avenue for $65 million. Terra Capital leases the land and owns the 100,000-square-foot building on the land, located a few blocks away from where Frank Gehry’s project is rising.