Coretrust Capital pays $336m for Los Angeles office building
Coretrust Capital Partners has acquired the Citigroup Center in Los Angeles.
The purchase price was $336m (€318m), according to sources.
Coretrust bought the 914,000 sqft property from Hines.
Both the buyer and seller declined to comment on the price paid.
John Sischo, a principal at Coretrust, said: “We had the great fortune to redevelop the neighbouring City National Plaza and view this investment as a redux, allowing us to rebrand and reposition this property to intersect with the needs and demands of forward-looking tenants.
“Our goal is to provide our tenants with a concierge-level service found in boutique buildings with amenities only a 1m sqft tower can provide.”
Hines acquired the property for $274.6m in 2008, according to public records.
Doug Metzler, a senior managing director with the company, said: “Hines is pleased to have been associated with Citigroup Center for the past eight years. We look forward to continuing to place capital in the greater Los Angeles area in the years to come.”
The asset was 74% occupied at the time of the sale, compared with the overall office market in the central business district area of Los Angeles at 84%.
Citicorp, Morgan Stanley and the Securities and Exchange Commission are among the property’s tenants.
Coretrust Capital made the acquisition in Los Angeles for its fund, the Coretrust Value Fund I.
The fund also owns the Two Liberty office asset in Philadelphia.
The fund manager has another $200m of capital that it could invest in other value-add office assets, focusing on Los Angeles, San Francisco, Houston and Philadelphia.
Leverage is typically around 65-70%.
Seven investors are in the fund, including a combination of sovereign wealth funds and US public pension funds.
Hines had acquired Citigroup Plaza for its US Office Value Added Fund II.
The manager had raised $828m of equity for the fund.
The Sacramento County Employees’ Retirement System committed $25m.