Andersons to Buy Century City Tower
Los Angeles businessman John E. Anderson’s real estate acquisition spree will soon include his largest purchase to date: a Century City high-rise. An affiliate of Duesenberg Investment Co., the real estate group headed by Anderson and his wife, Marion, has agreed to pay about $185 million for the 28-story tower at 1900 Avenue of the Stars.
Anderson, whose Topa Equities holding company has owned its headquarters building at 1800 Avenue of the Stars for many years, said he considers Avenue of the Stars a top address on the Westside and expects to achieve some economies as Duesenberg’s property-management arm takes over the tower next door.
The 1900 building is 97% leased after a recent lease signed with Jeffer Mangels Butler & Marmaro. The law firm’s initial annual rental rate is thought to be in the mid- to high-$30s per square foot. The 600,000-square-foot property also is home to other law firms and professional tenants, and includes a single-story satellite building.
As brokerage CB Richard Ellis’ latest market statistics indicate, Century City appears to have regained its status as the Westside’s preeminent commercial district. As the technology bubble peaked, office landlords in Santa Monica and Westwood commanded higher rents than their Century City counterparts. Now the Westside’s strongest demand is coming from more traditional businesses such as professional and financial services. CB Richard Ellis’ data from the fourth quarter of 2001 show landlords asking an average of $42 per square foot annually for Century City offices. Westwood rates are about $40.70, followed by Santa Monica at about $39.25.
“I think Century City remains the L.A. Basin’s real central business district; it just wasn’t affected much by the dot-com fallout,” said office broker Stan Gerlach at CB Richard Ellis. “The corporate and institutional environments are back in vogue,” added Gerlach, who recently helped negotiate Korn/Ferry International’s short-term lease extension at a Century City high-rise after the executive recruiting firm considered a move downtown.
The Andersons’ Duesenberg group is buying the 1900 tower from a venture between San Jose-based Divco West Properties and New York investment advisor Westbrook Partners. That partnership bought the building and its 20-story counterpart at 1901 Avenue of the Stars for around $200 million in the spring of 1999. An investment fund managed by Santa Monica-based Douglas Emmett & Co. bought the 1901 building last summer for about $150 million.
Anderson said he is willing to consider more Southern California acquisitions, but he’s already made nearly a quarter-billion dollars’ worth of recent local investments, plus a $95-million purchase of one of Hawaii’s biggest office properties late last year. “It’s important that we focus on digesting these [acquisitions] and making sure we take good care of our new tenants and properties,” he said.
