Vornado is shopping its last LA property for $150M
REIT seeking $617 psf for Class A office property
From the Los Angeles website: Looks like Vornado Realty Trust is finally done with La La Land.
The real estate investment trust is seeking a buyer for its last L.A. property, a 243,000-square-foot Class A office property at 800 Corporate Pointe in Culver City. The asking price is roughly $150 million, sources told The Real Deal.
Kevin Shannon and his team at Newmark Grubb Knight Frank are marketing the property, which is 98 percent leased by tenants including Ares Management and Thomson Reuters.
If Vornado gets its asking price, the deal would pencil out to about $617 a square foot, far exceeding the $317 a square foot Olive Hill Group paid in May when it acquired 200-300 Corporate Pointe for $65.5 million.
Culver City, however, is a lot cheaper than its Westside counterparts. Sources told TRD the offering for 800 Corporate Pointe compares the relative basis in the area to Playa Vista, which has seen trades for higher than $700 a square foot. Last year, Vornado sold another of its Westside buildings, at 520 Broadway in comparably pricey Santa Monica, to Tishman Speyer for $805 a square foot.
The 800 Corporate offering touts the fact that 22 percent of the property is occupied by tenants with leases expiring in 2018, giving the buyer the opportunity to raise rents that are 18 percent below market rate, sources said.
The property is the last man standing in Vornado’s L.A. portfolio, which the REIT has been downsizing over the past four years. In addition to the Santa Monica deal, it sold the Beverly Connection shopping center to Ashkenazy Acquisition Corp. for $260 million, or $744 a square foot, in 2014. It sold L.A. Mart at 1933 South Broadway for $55 million, or $69 a square foot, in 2012. That same year, it sold off the project known as the Reef at 1933 South Broadway for $53 million, or $67 a square foot.