The sale adds 146,973 sf of downtown Los Angeles office space to the portfolio of Jamison's founder, Dr. David Lee, who owns a portfolio of about $300 million in real estate holdings and is by far the largest office landlord in the city's Mid-Wilshire district.
Lee is known as one of the savviest and most successful office landlords in Los Angeles. He acquired Mid-Wilshire office buildings at about $40 to $50 per sf that were vacant or largely empty, then filled them with tenants.
Lee tells GlobeSt.com he perceives value in the Banco Popular building and in the downtown Los Angeles market. The building is stable with the city's Community Redevelopment Agency as its anchor tenant, he says, and he acquired the property for a low $41 per sf.
"We feel that the downtown market will come back up sooner or later, maybe not in the next year or so, but probably within four or five years," Lee tells GlobeSt.com.
The downtown central business district vacancy rate was 17.9% at the end of the second quarter, up from 17% the year before, according to Cushman & Wakefield, which brokered the Banco Popular building sale.
Cushman & Wakefield's Richard Plummer, Stephen Algermissen and Andrew Harper represented Hertz along with Wolfgang Kupka and Sue Ann Hsieh of Vista Realty Advisors. The nine-story Banco Popular building, listed on the National Register of Historic Places, was built in 1903 and formerly was known as the Hermann W. Hellman building. It was designed by the prominent L.A. architectural firm Morgan & Walls and is known for its classic revival modern architecture. It was renovated in 1979 and again in 1992 and is home to the Community Redevelopment Agency of Los Angeles, as well as Banco Popular, the largest Hispanic bank in the United States. The building was 69% occupied at the time of the sale.
Seller Hertz Investment Group also owns other historic Los Angeles buildings including The Oviatt Building and the Wiltern Theater. Hertz bought the Banco Popular building in December of 1997 from the banking entity Banco Popular.
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