Water Garden II, on Colorado Avenue and Cloverfield Boulevard, is owned by a group that includes LA-based developer J.H. Snyder Co. and an investment fund managed by Colony Capital. The building's most serious suitor is said to be the same J.P. Morgan Chase-advised investment group that purchased the original Water Garden from J.H. Snyder several years ago.

In an exclusive interview with GlobeSt.com, J.H. Snyder partner Cliff Goldstein says that "a number of potential buyers" have shown interest in the 95%-leased Water Garden II. But he won't confirm broker scuttlebutt that a sale to J.P. Morgan Chase is imminent.

"We hired Eastdil Realty to explore different options for the property, including a possible sale or arranging permanent financing to take out the construction loan," Goldstein tells GlobeSt.com. "At this point, we're keeping both those options open."

Late last year, rumors swept the Westside brokerage community that a buyer advised by investment banker Lazard Freres & Co. was about to buy Water Garden II for $260 million. Goldstein says his company was involved in negotiations with Lazard Freres, but that the two firms "never reached a meeting of the minds."

Buying Water Garden II would seem to be a good move for the J.P. Morgan Chase group, brokers say, in part because it would put both phases of the giant complex under the same ownership. Unifying ownership could conceivably cut operational costs and perhaps even build new marketing synergies: J.P. Morgan Chase could more easily accommodate tenants with changing space needs by moving them from one phase to the other, instead of losing them to a competing project.

"For them [Morgan Chase], it just seems to make a lot of sense," says Craig Meyer, SVP of Colliers Seeley International's local office.