Here’s what tenants pay at Colony Capital & Rising Realty’s One California Plaza

1M sf tower is close to 90% leased, led by law firm Skadden’s 145K sf

Colony’s Tom Barrack,, One California Plaza, and Rising CEO Christopher Rising (Credit: TM/Bauer-Griffin/GC Images via Getty Images, Tiffany Rose/Getty Images)

Colony Capital may be all-in on cutting-edge digital real estate these days, but just a few years ago, the company was still very much in the business of old-school real estate buys. Like in 2017, when it spent more than $450 million on One California Plaza, a Class A office tower Downtown Los Angeles.

When Tom Barrack’s Los Angeles-based firm and minority partner Rising Realty acquired One California Plaza from Beacon Capital, they financed the acquisition with a $300 million CMBS loan from Column Financial. Documents associated with securitization provide an inside look at the finances of the 42-story tower in Bunker Hill.

The 1 million-square-foot property was 87.7-percent leased to 34 tenants in 2017, and occupancy has since risen to 89.7 percent, according to the latest surveillance report from Kroll Bond Rating Agency. The top five tenants at the building have remained the same during that time, although Citigroup reportedly planned to relocate to the property, from the nearby Citigroup Center at 444 S. Flower Street, in 2018.

The average base rent at the property, $25.20 per square foot, was in line with the appraisers’ concluded market rent at the time of the financing.

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The largest tenant at the building is law firm Skadden, which pays $25.05 in base rent for each of its nearly 145,000 square feet and has been at the tower since 1986, soon after it was built. Los Angeles-based engineering and construction firm AECOM is the second largest tenant with about 124,000 square feet, and paying just under $20 per square foot in base rent. San Francisco-based Bank of the West, a subsidiary of France’s BNP Paribas, is the third largest tenant with about 90,000 square feet and paying $26.70 per square foot.

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The building is part of the larger California Plaza development, which includes a 453-key Omni Hotel, and a 1.5-acre Water Court, and another 52-story, 1.3 million-square-foot office tower known as Two California Plaza. Colony and Rising were reportedly also interested in acquiring that property from CIM Group in 2017, but a deal did not materialize.

Rising Realty Partners, which manages One California Plaza, has a minority stake that comes out to just a few percentage points according to the loan prospectus. Colony itself ended up syndicating 90 percent of its equity in the property to third-party investors soon after the acquisition, according to SEC filings. The property holding entity was deconsolidated, with Colony’s remaining interest reflected as “an equity method investment.”

In recent years, Colony has signaled a strategic shift and plans to sell off all of its “legacy” properties, which would include traditional office buildings. The company recently sold off most of its hotel properties to Highgate Hotels in a deal valuing them at $2.8 billion, a move precipitated by financial struggles and defaults brought about by the pandemic.

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