Onni Group Lands $550M Loan for Miracle Mile Asset in LA
- Jun 20, 2019
Onni Group, a Vancouver, Canada-based real estate developer and operator, has acquired Wilshire Courtyard, a two-building office campus in the heart of Los Angeles’ Miracle Mile, from Tishman Speyer for $630 million. The firm received a $550.2 million floating-rate loan from French multinational financial services firm Natixis to help fund the transaction, which closed this month.
The Class A, six-story LEED Gold-certified office buildings are located at 5750 and 5700 Wilshire Blvd. The buildings were constructed in 1987 and were recently renovated by Tishman Speyer, which acquired the two-asset portfolio in December 2012 from RREEF Property Trust for $422.5 million, according to Yardi Matrix data. RREEF Property Trust had paid Stockbridge Capital Group $378 million for the two buildings in August 2005, Yardi Matrix reported. Tishman Speyer will remain as the leasing manager and property manager of both buildings, according to Yardi Matrix.
Wilshire Courtyard East—5700 Wilshire Blvd.—has 540,391 square feet of space, including 5,357 square feet of ground-floor retail. Wilshire Courtyard West—5750 Wilshire Blvd.—has 462,375, including 16,000 square feet of ground-floor retail. Both buildings have numerous entertainment-related businesses as tenants including Skydance Animation and Webtoon Entertainment at 5750 Wilshire Blvd. and The Virtual Reality Co., Red Pill VR, Rebel Entertainment Partners and Fox Animation Studios at 5750 Wilshire Blvd. The Coffee Bean & Tea Leaf has a retail space on the first floor of 5700 Wilshire Blvd., as well as office space. The firm is expected to eventually move its office headquarters to a new space in the Baldwin Hills/Crenshaw neighborhood, the Los Angeles Business Journal reported. At the time of the sale, 5700 Wilshire Blvd. had a 17 percent vacancy rate and 5750 Wilshire Blvd. had a 68.4 percent vacancy rate.
The property features restaurants, retail and cultural attractions that are available to tenants. Other amenities include private balconies providing city and mountain views, a state-of-the-art Equinox fitness center, park with jogging trail and three-level parking garages in each building.
Growing office market
The Los Angeles office market added 17,000 office-using workers in 2018, up 1.6 percent year-over-year. Boosted by the media and entertainment sectors, as well as the growth of the technology industry, the metro had a 4.6 percent unemployment rate last December. Among the tech companies expanding recently are Apple, which opened a 75,000-square-foot office in Culver City last year and is planning a second location nearby that will have 128,000 square feet of space. Google also added 500,000 square feet of office space in the Los Angeles metro area, leasing the Hercules Campus at Playa Vista in the Jefferson Corridor.
Entertainment companies are also taking more office space. In April, Warner Bros. said it was expanding into two Frank Gehry-designed office buildings totaling 800,000 square feet that will be constructed adjacent to its main lot in the Burbank Media District by a partnership of Worthe Real Estate Group and Stockbridge Real Estate Fund. Also in April, HBO announced it would lease the entire 240,000-square-foot office building being constructed within the $350 million Ivy Station mixed-use development in Culver City for its new corporate headquarters.