Hines Buys Union Bank Plaza for $140M

Hines acquired the Union Bank property from Chicago-based Walton Street Capital in a deal that marks the third time that the Union Bank skyscraper has sold in the past four years. In 2001, locally based Hertz Investment Group acquired the property for $88 million. Then, in 2002, Hertz sold the asset to Walton Street for $110 million.

One source who has tracked the deal tells GlobeSt.com that before Hines got involved, an investment group led by Louis Dreyfus Real Estate of New York came close to buying the building some months ago. But that transaction fell through, even though the prospective buyer had put down hard money on the deal, so Walton Street Capital put the property back on the market.

Hines will be its own leasing agent on the Union Bank property, which formerly was a CB Richard Ellis leasing assignment. Hines represented itself in the acquisition, which was brokered by Zietsman Realty Partners. Union Bank Plaza, designed by Albert C. Martin & Associates, was completed in 1967 as the West Coast headquarters for Connecticut General Life Insurance Co. The tower has long been a high-profile project in Downtown, with its reputation as the first Bunker Hill Redevelopment Project Area building, and it burnished its image when it was renovated in the mid-1990s.

Now 95% leased, the tower serves as the regional headquarters for Union Bank of California, an original tenant that currently occupies more than half of the building. Hines SVP Colin Shepherd says the company is "a strong believer in the future of Downtown Los Angeles," with Hines forecasting strong rent growth in the near future.