Rodeo Drive Retail Sells for $400 Million

A Tom Ford, Moncler and Balenciaga-leased property on Rodeo Drive sold for more than $400 million.

Ronan McNamee’s ECA Capital Limited was the seller. The company purchased the 28,000-square-foot property at 338 North Rodeo Drive for $81.5 million in 2007 — and McNamee refinanced the property at $160 million six years ago. The identity of the buyer wasn’t immediately known.

The deal is believed to be the second-highest sale ever in Beverly Hills, after Nicholas and Christian Candy’s $500 million purchase of what was once a Robinson’s-May department store in 2007. The 338 North Rodeo Drive sale could be a one-property record for the famed street, and the building may have fetched the lavish price because of its development potential.

Other pricey retail sales along the iconic street include LVMH’s $245 million purchase of a 22,300-square-foot, two-story double lot at 468 North Rodeo Drive; hotelier Efrem Harkham’s $200 million sale of the 43,000-square-foot lot that held a boutique hotel plus three retail stores at 360 North Rodeo Drive; and Crown Equity’s Michael Shabani’s purchase of two storefronts spanning 11,600 square feet at 457-459 North Rodeo Drive for $112 million.

Caruso for small businesses

Billionaire Rick Caruso’s nonprofit announced a $1 million donation from Banc of California’s Wildfire Relief & Recovery Fund for small businesses.

The small business initiative aims to support retailers, restaurants and other businesses in Altadena, Malibu and the Pacific Palisades impacted by the wildfires earlier this year via direct grants of up to $50,000.

“These small businesses were about much more than commercial or economic activity. They were local hallmarks that gave neighborhoods their soul and fostered a sense of community,” Caruso said. “We cannot abandon them. This is about ensuring they have the tools, resources and support they need to come back.”

The businessman and once mayoral candidate’s Pacific Palisades mall survived the fires thanks to private firefighters, but is closed because of the devastation surrounding it.

“These businesses aren’t faceless storefronts. They are the fabric of the community,” Caruso said. “They are made up of people: owners, employees and loyal customers. They deserve an advocate to help address the challenges they’re facing through no fault of their own. Through this initiative, they’ll have one.”

More losses at Hudson Pacific Properties

Hudson Pacific Properties has fallen on hard times.

The company reported an $83 million loss for the second quarter compared to a $47 million loss a year earlier.

Revenues decreased to $190 million from $218 million a year ago because of declining office occupancies and discounted asset sales — that includes a San Francisco office building the company sold earlier this summer for $28 million, about half the $56.5 million Hudson Pacific purchased it for a decade ago.

The real estate investment trust’s office revenues fell to $156 million in the three months ending June 30, compared to $176 million during the same period last year. Production studio revenues fared worse too, dropping to $34 million from $42 million year-over-year.

Hudson Pacific chair and CEO Victor Coleman, whose total compensation was valued at about $25 million last year despite ballooning losses, hinted at offloading more properties in the future and commended leasing during the company’s earnings call.

Hudson Pacific executed 558,000 square feet in leases in the second quarter, a small increase from a year earlier. Second-quarter leases included a six-year, 77,000-square-foot renewal with a cybersecurity company in Foster City; a nine-year, 41,000-square-foot renewal with a digital sports company in Los Angeles; and a six-year, 32,000-square-foot new lease with a bio-tech company in Palo Alto.

Office-to-resi in Westood

Douglas Emmett plans to turn an office tower it purchased for $131 million from Tishman Speyer through a deed-in-lieu of foreclosure into apartments.

The 17-story, 247,000-square-foot office building at 10900 Wilshire Boulevard, coupled with a residential building Douglas Emmett plans to construct on the same lot, is set to become a 320-apartment complex in Westwood. The real estate investment trust’s CEO, Jordan Kaplan, said he expects the conversion to enhance the property’s value during its second-quarter earnings call. Still, the conversion will occur over an undisclosed number of years as offices are vacated on a floor-by-floor basis — and anticipated costs have increased.

“Including the costs to acquire the property, convert the existing office tower and construct the new building, we expect this plan to increase the total project costs to approximately $200 million to $250 million,” the company said in an earnings release.

Before the planned conversion, the company expected the cost to be $150 million to $200 million, and that would include the acquisition, construction of the apartment building and upgrades to the existing tower.

A loyal law firm

Law firm Behar Gibbs Savage Paulson renewed its about 36,000-square-foot lease across two floors at One World Trade Center in Long Beach.

Behar Gibbs Savage Paulson has occupied the top two floors of the 27-story, approximately 575,000-square-foot building for the last 35 years. The building’s asking rents are between $2.95 to $3.15 per square foot per month.

Since 2023, Los Angeles office absorption has been increasingly dominated by law firms and financial companies. The two years before, technology and entertainment companies led the way.

Fisher Phillips inked a new lease for about 36,000 square feet at 515 South Flower Street in Downtown Los Angeles — and an almost 14,000-square-foot lease at 21600 Oxnard Street in Woodland Hills last week. Paul Hastings, Hill, Farrer & Burrill, Hanson Bridgett and Mayer Brown have renewed or signed new leases Downtown in recent years, too.

Arts District’s all-in-one

The Los Angeles City Council gave the green light for Danish architect Bjarke Ingels’ mixed-use high-rise development in the Arts District.

The project at 670 Mesquit Street, which has been in the works for almost a decade, is set to hold four interconnected towers, the tallest of which would be 34 stories. The developer, Vella Group, plans to build 676,000 square feet of office space; 894 residential units; a 271-room hotel; a charter elementary school; and commercial spaces for retail, restaurant and art galleries.

The mixed-use campus will replace the Rancho Cold Storage facility owned for years by the Gallo family. Construction is expected to take place either over a single five-year period or in separate phases over nine years. A completion date has not yet been announced but total cost is estimated at $1.4 billion.

It was initially proposed as an office-heavy development but has shifted to mostly housing.