Here’s what tenants are paying at Jade Enterprises’ 888 Figueroa in DTLA

When Jade Enterprises bought the 404,000-square-foot office tower at 888 South Figueroa Street, the Downtown Los Angeles property wasn’t in great shape.

Jade paid $50.5 million for the building in 2004, receiving a property that was “poorly maintained,” had a 69 percent occupancy rate and a “non-local/non-responsive owner,” according to a recent DBRS Morningstar report.

Sixteen years and $23 million in renovations later, 888 Figueroa has an appraised value of $210 million and counts several state and federal agencies among its tenants. In 2019, Jade secured a $115 million CMBS refinancing for the property from MUFG Principal Commercial Capital, and associated documents provide an inside look at the building’s finances.

At the time of the refinancing, the 20-story office tower was 85 percent leased to 36 distinct tenants according to the loan prospectus. The average base rent was $37 per square foot.

The top tenant, TJX Companies, started out with a 2,860-square-foot lease at the property in 1987 and has since expanded to more than 98,000 square feet. The department store corporation, whose brands include T.J. Maxx, Marshalls, and HomeGoods, operates its West Coast buying branch at the building.

The second-largest tenant is the State of California with 49,000 square feet and a well above-average base rent of more than $50 per square foot. Five state agencies occupy the building: the Employment Development Department, the State Controller, the Department of Social Services, the Department of Alcohol Beverage Control, and the Department of Rehabilitation.

The third-largest tenant is the federal government’s General Services Administration, which leases 43,000 square feet on behalf of seven agencies: the Department of Transportation, the Alcohol and Tobacco Tax and Trade Bureau, the Social Security Administration, the Office of the Inspector General, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Department of Justice, and the Office of Disability Adjudication and Review.

The fourth-largest tenant, First Republic Bank, has a large banking hall on the south end of the building’s ground floor as well as company signage affixed to the top of the building. As of 2019, ground floor retail included Fatburger, Denny’s, Avis and Mrs. Winston’s, according to DBRS Morningstar site inspection.

MUFG, which provided the $115 million whole loan, is a CMBS lending platform formed by Mitsubishi Group’s MUFG Union Bank and Principal Real Estate Investors. The $75 million A-1 note was contributed to a CMBS transaction named CD 2019-CD8, while the rest of the debt has yet to be securitized, according to Trepp.

Run by brothers David, Albert, and Benny Taban, Jade Enterprises made 888 Figueroa its headquarters. The firm owns more than 100 properties across California and southern Nevada, with more than 3 million square feet of office space and 2 million square feet of retail. In December, it filed plans to develop a 263-unit apartment complex in Pasadena, the third and largest project it mapped out last year in the L.A. area.