Kilroy Realty moves into Hollywood with $79-million office deal
Venerable Los Angeles office landlord Kilroy Realty Corp. has made its first move into Hollywood with the $79-million purchase of Sunset Media Center, a high-rise near the intersection of Sunset Boulevard and Vine Street.
Kilroy plans to spend “many more millions of dollars” to renovate the 22-story tower built in 1972, said David Simon, Kilroy’s executive vice president for the Los Angeles region.
The goal is to reposition the building at 6255 W. Sunset Blvd. as more upscale and attract tenants capable of paying higher rents. In recent years the blocks around Sunset and Vine have seen substantial improvements with the addition of new apartments, stores, restaurants, night clubs and hotels.
“It’s an amenity-rich market,” Simon said. The company plans further acquisitions of Hollywood properties that can be upgraded to appeal to prosperous firms in creative businesses.
Kilroy, which was founded more than six decades ago, is often associated with its office buildings near Los Angeles International Airport and in Orange County near John Wayne Airport. Recent acquisitions, though, include offices in Seattle, San Francisco and Silicon Valley.
“We focus on technology, media and entertainment,” Simon said.
The acquisition of Sunset Media Center took more than a year to complete, he said. The sellers were multiple investors in a group managed by Passco Cos.
Updating Sunset Media Center to compete for Hollywood’s resurgent entertainment and tech industries is a logical strategy for Kilroy, said real estate broker Carl Muhlstein of Cushman & Wakefield, who represented the landlord in the sale.
“Hollywood has one of the lowest vacancy factors in the city at 6% to 8%, and nobody is building new offices from the ground up,” he said.
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