Commercial Real Estate Direct Staff Report
Vornado Capital Partners, an $800 million investment vehicle controlled by Vornado Realty Trust, has paid $95.7 million, or roughly $384/sf, for 800 Corporate Pointe, a 243,000-square-foot office building in Culver City, Calif.
The fund purchased the property, at the intersection of the 405 and 90 freeways, from Spear Street Capital. Legacy Partners had purchased the four-story building in 2008 for $99 million from Symantec Corp., which developed it in 2007 and continues to lease space in the building. It had financed its acquisition with $85.7 million of debt that Corus Bankshares had provided.
Vornado, which owns a 25 percent stake in Vornado Capital, viewed its purchase as opportunistic as 800 Corporate Pointe is only 44 percent occupied. It includes a six-level parking structure with a capacity of 1,964 vehicles.
Vornado is evidently betting on a continued recovery in Culver City, a Los Angeles suburb. The submarket has performed solidly. Colliers International said it was the best performing submarket in the entire Los Angeles market, with some 107,400 sf of absorption last year, 50,800 sf during the fourth quarter alone.
At the end of the fourth quarter, Culver City had a 14.6 percent vacancy rate, lower than the Los Angeles area's overall 15.9 percent average, according to Colliers. And average asking rents were nearly $30/sf. That compares with a market average of nearly $40/sf. But that's skewed by the $44.50/sf asking rents in Beverly Hills and $48.24/sf in West Hollywood.
Comments? E-mail Orest Mandzy, or call him at (267) 247-0112, Ext. 211.
