In a deal closed this week, a three-building office portfolio in Pasadena, Calif., sold for $80 million to a private investor in Los Angeles. The transaction had originally been scheduled for the first quarter of 2020, but the COVID-19 pandemic considerably delayed the process.
The portfolio totals 242,000 square feet of Pasadena office space and includes an 11-story property at 2 N. Lake Ave. originally built in 1985; a three-story building at 911 E. Colorado Blvd. completed in 1926; a one-story structure located at 902 Boston Ct.; and an additional six-story parking garage.
A team comprised of Erica Finck, Bailey Dawson and Marc Renard from Cushman & Wakefield negotiated on behalf of the seller, 2 North Lake JV LLC, which is a private family ownership in Hong Kong and Los Angeles. According to public records, the previous owners had acquired the portfolio in 2009 for roughly $52 million.
Situated near the Foothill (210), Glendale (2), and Pasadena (110) freeways, as well as the Metro Gold Line, the site boasts a WalkScore of 95. Additionally, the North Lake building features a unique penthouse floor with high ceilings and a large exterior patio; a helipad; and a panorama of the neighboring San Gabriel Mountains.
The collective occupancy rate for all three buildings stands at 63%, with a varied tenant roster that includes marketing, financial, medical, legal and tech businesses. The tech and entertainment industries, in particular, have played a major role in anchoring the greater Los Angeles office market throughout the pandemic, driving leasing activity.
“This portfolio sale of the high-vacancy, value-add office portfolio is another indicator that the office market recovery is in full effect and investment is being recalibrated back into this sector,” said Mike Condon Jr., vice chairman of Cushman & Wakefield.
Finck added, “The sale of 2 North Lake is a testament to the outstanding long-term viability of the Pasadena office market and office product as a top asset class overall. It is also proof that capital continues to view office as an important and accretive component of their overall portfolio. We expect to see greater acceleration in office investment over the coming months.”
The buyer has revealed future renovation plans that would reposition the property as a Class A asset following upgrades and improvements to the lobbies and outdoor areas.