Santa Monica High-Rise to Sell for $90 Million
One of Southern California’s most desirable office buildings, 100 Wilshire in Santa Monica, is being purchased by Brentwood-based Douglas Emmett Realty Advisors for an estimated $90 million, The Times has learned.
The sale by Asahi Urban Development is believed to be one of the few cases in which Japanese owners of trophy properties purchased at the peak of the 1980s real estate boom in California have received more for a building than they paid for it.
Douglas Emmett, perhaps the most aggressive buyer of high-quality office buildings in the Los Angeles area during the last five years, is expected to take ownership soon of the 21-story tower overlooking the beach at Wilshire Boulevard and Ocean Avenue, according to knowledgeable real estate sources.
The building, Santa Monica’s tallest, was originally developed by bandleader Lawrence Welk in 1968. It served as GTE California’s headquarters during the 1970s and early 1980s. Today the white skyscraper commands some of Southern California’s highest rents, with asking rates for the scant amount of space now available as high as $4.50 per square foot monthly--a rate rarely matched even at the most expensive offices in Beverly Hills and Century City.
Managers at Douglas Emmett, who acquire and operate real estate on behalf of institutional investors, as usual declined to comment on their investment activities. The company already owns Santa Monica’s second-tallest office building, the 12-story 401 Wilshire, and at least three others in the downtown district. It recently acquired three other Los Angeles-area office properties and is also said to be pursuing a pair of Century City high-rises.
Real estate brokerage Cushman & Wakefield confirmed that it has been engaged to sell the property on behalf of San Francisco real estate investment trust AMB Property Corp., which acts as advisor to the property’s owner, an affiliate of Japan’s Asahi Urban Development. Cushman & Wakefield and AMB representatives declined further comment.
Asahi Urban acquired the tower in 1987 for a reported $73 million after a local affiliate of Dallas’ Southmark Corp. bought, renovated and leased the 245,413-square-foot property following GTE’s departure. The Douglas Emmett deal may be one of the few instances in which a Japanese group that bought real estate near the last cyclical peak in the late 1980s actually made a profit by selling it in the 1990s.
“I can’t offhand think of another” such situation in Southern California, said Bob Safai, a broker who has participated in several office-building sales over the last couple years as investors have targeted the strong Westside market. “It’s clearly one of the top buildings in Santa Monica and can never be duplicated” due to zoning restrictions the city has since put in place, the Madison Partners founder added.
Cushman Realty Corp. vice president Eric Olofson, the property’s leasing agent since 1991, said the building has essentially been fully occupied for the last two years. Among the larger tenants are money manager Roxbury Capital Management, law firm O’Neill Lysaght & Sun and real estate developer Raleigh Enterprises.
