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Carolwood buys DTLA’s AON Center for $148M
Sale marks ends months of negotiations for $134-a-foot deal
Carolwood, the investment firm run by Adam Rubin and Andrew Shanfeld, has closed on a deal to buy the AON Center in Downtown Los Angeles for $147.8 million, ending months of negotiations around the sale, The Real Deal has learned.
The deal came out to $134 per square foot, marking one of the lowest deals on a price-per-square-foot basis for an office tower in DTLA in the last 10 years, according to a source familiar with the matter. Rubin and Shanfeld declined to comment.
A team led by Newmark’s Kevin Shannon brokered the deal on behalf of the seller.
Carolwood bought the property in a joint venture with Daniel Abrams, a real estate investor.
The 1.1 million-square-foot tower at 707 Wilshire Boulevard also sold at a roughly 45 percent discount from what the seller, Shorenstein Partners, paid for it in 2014.
Shorenstein, which did not respond to a request for comment, was forced to sell to resolve debt on the property, according to sources familiar with the matter.
The firm put the building on the market in January, asking $220 million, or about $200 per square foot, according to reports. Before the pandemic, Shorenstein had turned down an offer on the tower for $380 million, a source familiar with the matter said.
The deal is a benchmark for future office towers in Downtown L.A. Before the pandemic, which roiled office markets across the country, the same buildings were valued at more than $450 a square foot. In 2017, Tom Barrack’s Colony NorthStar and Rising Realty Partners paid $465 per square foot to buy One California Plaza.
Carolwood’s deal had been in the works since May. Rubin’s other firm, L&R Group of Companies had originally bid about $160 million on the tower.
The sale is subject to a roughly $8 million city tax, under the city of L.A.’s Measure ULA, which went into effect in April.
The last time a DTLA office tower traded hands was before ULA was implemented.
At the end of March, Joel Schreiber’s Waterbridge Capital paid $110 million, or about $158 per square foot, for the 701,000-square-foot Union Bank Plaza, after successfully negotiating the purchase price down over the course of nine months.