GlobeSt.com UPDATE: Empty Building Sells for $444 Per SF

BEVERLY HILLS, CA-Tishman Speyer of New York City has paid $71 million for a two-year-old, 160,000-sf office building at 407 N. Maple Drive that has never been occupied. The sales price of $443.75 per sf ranks higher than the prices per sf paid for some Beverly Hills office buildings that are fully or partially occupied, but broker Bob Safai of Los Angeles-based Madison Partners tells GlobeSt.com that the price makes a lot more sense than it might first appear to those unfamiliar with the deal.Safai represented the seller of 407 N. Maple, a partnership of entertainment mogul David Geffen and health care magnate Dr. Bernard Salick. Although it is record-setting, the price is still below replacement cost and reflects a number of factors, according to Safai.”First, you couldn’t get that building built today because the city wouldn’t let you, and second, even if you could get it built, you couldn’t get that kind of density right now,” Safai tells GlobeSt.com. “Third,” he says, “a building of that quality would cost $600 per sf to build today,” compared with about $400 per sf when the sellers built it.Besides those factors, Safai explains that the purchase is “a really strategic acquisition” for Tishman Speyer, which owns the buildings on either side of it. “Tishman virtually owns the entire city block. That’s 600,000 sf of the Beverly Hills class A market,” he says.Once the 407 N. Maple project is leased, it will take the Beverly Hills submarket to below 8% vacancy, Safai notes. As mentioned in a GlobeSt.com report this week about Tishman Speyer’s acquisition of the 400 S. Hope St. building in Downtown Los Angeles, the New York firm’s other Beverly Hills holdings include the 287,000-sf Maple Plaza and the 140,000-sf Beverly Mercedes Building. Safai describes 407 N. Maple as “really a piece of art, not just a building,” with some of the most distinctive architectural lines of any building in the city. Some older buildings in they city are as architecturally distinctive, but “there is nothing modern like it,” he says. It was designed by the New York-based firm of Gawthmey Siegel & Associates Architects LLC.