Jamison Lists Los Angeles Offices for Sale

Jamison Properties is offloading a distressed office building in Downtown Los Angeles in the latest sign of the office market’s post-pandemic doldrums.

The Koreatown-based company has listed the more than 337,000-square-foot building at 811 Wilshire Boulevard for sale, CoStar reported. The building is being offered in a joint deal that includes the parking garage next door at 616 South Figueroa Street.

Jamison is facing possible foreclosure on various properties throughout the city, including the 21-story 811 Wilshire building. It defaulted on a $35 million commercial mortgage-backed securities loan tied to the building last November. The landlord took out a 10-year, $39 million loan for the building in 2014, with the loan maturing late last year.

The loan was sent to special servicing, adding to Jamison’s growing debt of more than $200 million that collectively backs seven other Jamison-owned buildings spanning more than 2.4 million square feet. Jamison bought the property in 2003 for $26.5 million.

Office occupancy at the 1960-built building has dropped off significantly in recent years, reaching about 35 percent at the end of last year, per CoStar. On top of that, lease agreements with some of its remaining tenants are soon set to expire, threatening to send the vacancy rate even higher as Jamison works to meet its financial obligations for the building.

As more companies implement return-to-office initiatives across the country, professional services firms in industries like law, accounting and consulting have come to dominate office absorption in Los Angeles. It’s a notable shift from the post-pandemic years of 2021 to 2023 when tech and entertainment firms led the office-grabbing blitz.

Office vacancy in Downtown Los Angeles ticked up to 33.6 percent in the first quarter, from 28.8 in Q1 2024, according to a report from CBRE, further squeezing firms like Jamison as it works to pay down debts.

In DTLA, Brookfield Properties, for example, has been one of the firms feeling the pinch of the floundering office market. Last month, the New York-based firm offloaded the 601 South Figueroa Street building to Uncommon Developers for $210 million — not enough to cover the $250 million in debt tied to the 52-story tower. Brookfield also sold the 777 Tower at 777 South Figueroa Street last year for $120 million, making up less than half of the $319 million debt tied to the property.

— Chris Malone Méndez