Pendulum swings Culver City office deal at $500 psf

Industrial might be hot and studio space even hotter in LA –– but investors are still in the market for office buildings.

Pendulum Property Partners and Boston-based value-add investment firm Long Wharf Capital demonstrated as much with the purchase of an 111,384-square-foot office building for $56 million — around $500 per square foot, according to an announcement from CBRE, which brokered the deal for the sellers.

Watt Properties and Edge Principal Advisors sold the building. The venture bought the property for $26.7 million in 2015, records show.

Located at 3000 S. Robertson Boulevard, the building is currently leased to tenants including Kaiser Permanente and WeWork, the latter of which occupies around 30,000 square feet of space.

Despite Apple, Amazon and HBO all occupying office space in Culver City, total office availability remains high. Around a third of all office space in the city was vacant in the second quarter of this year, according to Savills.

High vacancy rates across Los Angeles County hasn’t stopped Pendulum and Long Wharf from pursuing office deals. In May, the firms bought a 125,000-square-foot building in Burbank leased to a number of production firms for $61.5 million.

The purchases in Culver City and Burbank show the firms’ “strong belief” in L.A.’s tech and media and entertainment sectors.

They’re not alone –– some tenants in the sector are pivoting to building their own office and production campuses. Last month, Apple said it was building a 550,000-square-foot expansion of its campus in Culver City, along Washington, National and Venice Boulevards. The tech giant bought the properties for around $163 million last year.