REIT buys L.A.'s One Wilshire
An office building in downtown Los Angeles that is the distribution hub for most electronic communications between Asia and the United States has been bought by a Texas investment company.
Private equity firm Carlyle Group is expected to announce today that it has sold the One Wilshire building to Houston-based Hines Real Estate Investment Trust Inc. for $287 million.
The 31-story building at the eastern end of Wilshire Boulevard at Grand Avenue is one of the two largest switching hubs in the country, routinely routing billions of phone calls and other communications such as e-mails and World Wide Web pages per week, said Thomas M. Ray, managing director of Carlyle Group. Its counterpart on the East Coast is 60 Hudson St. in New York.
“One Wilshire is the dominant point of interconnection for communication traffic between Asia and North America,” Ray said. Data stream in on a submarine cable from Asia and are distributed from there while other data are routed in the opposite direction.
One Wilshire was built as a standard office building in 1966. After the telecommunications industry was deregulated in 1984, competitors started laying underground cable in downtown Los Angeles with a heavy concentration near Wilshire and Grand, Ray said.
A handful of former office and retail buildings near there became data-transfer centers, but One Wilshire is the largest, with more than 300 communication service providers renting space for their computer servers and switching equipment.
Internet traffic including Google and latimes.com passes through the site.
Washington-based Carlyle paid $119 million for the building in 2001 and spent $30 million on such improvements as heavy-duty electrical feeds, powerful air conditioning and emergency generators, Ray said.
The largest tenant is data center manager CRG West, a subsidiary of Carlyle Group. Other tenants include Verizon Communications Inc., Qwest Inc. and AT&T; Inc.