International sports and entertainment behemoth AEG has agreed to consolidate its Los Angeles offices by leasing a historic former warehouse near downtown's LA Live.
AEG will move more than 500 employees of its AEG Live and AXS Ticketing divisions from other parts of the city to the century-old building now known as the Desmond. AEG's corporate headquarters will remain two blocks away at the LA Live entertainment complex.
AEG will lease the entire brick and concrete structure at 11th and Hope streets that is being renovated by landlord Lincoln Property Co. Lincoln's $13-million makeover will add a glass pavilion to the roof of the existing five-story building, bringing its total area to 82,000 square feet.
"By bringing the AEG Live and AXS Ticketing divisions to the Desmond, we are reaffirming our commitment to downtown Los Angeles," said Ted Fikre, AEG's vice chairman and chief legal and development officer. "With this decision, we are bringing leading global brands in the ticketing and live music business to what is clearly now the region's most important business district."
The building in downtown's burgeoning South Park district has been vacant for several years, but it was once the site of an auto dealership. It opened in 1916 as a full-service outpost of Ohio automaker Willys Overland Co., which sold luxurious Willys-Knight cars to the city's well-to-do.
It later became a warehouse for Desmond's, an upscale local dry goods store chain.
For AEG, Lincoln will prepare an open-plan "creative" office space with exposed ceilings. The transformation will include a 7,000-square-foot addition to the roof that will create a sixth floor, said Rob Kane, a Lincoln vice president.
The new top floor will be occupied by Goldenvoice, a concert promoting arm of AEG Live, Kane said.
"It'll be indoor-outdoor space with rolling glass doors and patio views of the downtown skyline," he said. "That was a big draw for them to come to the building."
The former ground-floor auto showroom space will get a coffee shop and bakery tenant, AEG said.
Terms of the lease were not disclosed, but Lincoln was asking for $3 per square foot per month, downtown brokers said.
Construction is anticipated to last eight months, with full occupancy expected in April 2015. The Desmond will also undergo a full seismic retrofit intended to meet recently enacted standards for earthquake safety.
AEG Live is the world's second-largest concert touring and promotions agency. AXS Ticketing, which was founded in 2011, is North America's second-largest ticketing source for venues including Staples Center and London's O2 arena.