After buying the building last year, Alliance leased it to defense electronics firm Teledyne, which moved from its longtime headquarters in West Los Angeles. With Teledyne as a tenant, Safai says, owning the 501 building "is like purchasing a bond."
The $26.5 million purchase price was substantially below replacement cost at $215 per sf, notes Safai, who has now sold the 501 building four times. In this latest sale, Madison partners also helped to arrange an $18 million loan for the deal through Capmark.
Alliance bought the 501 Continental Blvd. building from Red Sea Group USA of Los Angeles as part of a two-building property called El Segundo Research Center that also included an 80,000-sf building at 1940 Mariposa. The Mariposa building sold separately soon after that deal.
The most recent sale of the 501 building marks the latest in a series of Los Angeles market moves by both Alliance and Redwood Partners. Alliance recently bought two former Washington Mutual buildings in Northridge totaling 237,110 sf for $25.4 million in a deal brokered by Madison Partners and Redwood acquired the 110,000-sf Commerce Park office project on the border between Santa Monica and Los Angeles from Pacific Structures LLC of Santa Monica for slightly more than $29 million.
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