Spieker Buys Tower High-Rise in Westwood for Estimated $58 Million

With demand for quality Westside office space expected to keep outstripping supply, a Menlo Park real estate investment trust has paid an estimated $58 million for a prominent Westwood high-rise.

Spieker Properties Inc., which already owns a portfolio of office buildings stretching west from Sepulveda Boulevard, can now count the Tower at 10940 Wilshire Blvd. among its holdings.

Spieker owns Santa Monica Business Park and Marina Business Center, along with the Sepulveda Center, Arboretum Courtyard and the recently renovated Santa Monica Gateway. Spieker purchased the green-and-yellow Tower, designed by Chicago architect Helmut Jahn, from a joint venture of New York-based Tishman Speyer Properties and Citigroup. Eastdil Realty brokered the sale.

Tishman Speyer operated the 207,300-square-foot Tower as Westwood became one of Southern California’s highest-rent districts over the last few years. The Tower’s newest tenants are paying about $45 per square foot annually, said John Davidson, Spieker’s Southern California regional president in Irvine. The 24-story building is now more than 95% leased.

Tishman Speyer was asking closer to $35 per square foot for the Tower’s vacant offices just a year ago. And rents were typically in the mid-$20s in the mid-1990s.

For the entire Westside, asking rents are up 26% over the last year--from about $30 per square foot to nearly $38. And vacancies have fallen by more than 40% to just 4.74%, according to CB Richard Ellis.

Spieker’s share price nearly doubled over the nine months from December’s 52-week low and a high of $59.13 on Sept. 15. Shares of the company, which now owns more than 40 million square feet of office and industrial property in major West Coast markets, closed off 56 cents Monday at $54.88 on the New York Stock Exchange.