StratReal, which is asset manager of a $7-billion US real estate portfolio, in turn has retained CB Richard Ellis to assist the London-based firm with leasing and property management. As reported on GlobeSt.com this week, Strategic Real Estate Advisors acted as real estate investment adviser to the seller in the sale of Two Rodeo, which is home to Tiffany & Co. and other high-end retailers.
The buyer was represented by Steve Algermissen and Andrew Harper from Cushman & Wakefield's Southern California capital markets group, along with Ashley Marrison from Cushman & Wakefield's London office. The seller was also represented by Falcon Real Estate of San Diego.
Rolin tells GlobeSt.com that in the seven years StratReal has been asset manager for the property, rents have climbed to the range of $550 to $575 per sf per year. "We saw a significant upward movement of the rents in the building beginning in 2004," Rolin says, pointing out that rents had declined to about $125 per sf at Two Rodeo after the tech industry slump and the Sept. 11 terrorist attacks in 2001.
The European family trust that sold the Two Rodeo center had owned it since August of 2000, when it bought the center from a Japanese joint venture for $131 million and retained StratReal to take over asset management. The property is 100% leased to a roster of 24 tenants that include Tiffany and some of the most prominent names in luxury and fashion, among them Versace, Jimmy Choo, Rene Caovilla, Damiani, Cole Haan, Jose Eber and others.
Rolin describes Two Rodeo as one of a number of buildings worldwide that reflect a trend in which a relatively small number of luxury goods companies are renting space in buildings owned by a relatively small number of property owners who specialize in owning and operating high-end retail buildings. Sloane, for example, also owns the nearby One Rodeo Dr. building.
The Two Rodeo deal also indicates that, "there is a lot of foreign interest in Los Angeles again," Rolin adds. He points out that the Two Rodeo sale involved both a European buyer and a European seller, and that other foreign firms have acquired large stakes in Beverly Hills properties lately.
For example, a joint venture of Ireland's Dublin-based First Equity Group and locally based HDS Group recently bought two sites in Beverly Hills where the JV is planning $300 million of mixed-use condominium and retail development. Earlier this year, British developer and investor CPC Group paid $500 million for 9900 Wilshire Blvd., an eight-acre site that is planned for a 252-unit LEED-certified condominium tower.
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