Equity Firm Pays $53M for Oceanfront Office

PACIFIC PALISADES, CA—A joint venture between Lincoln Property Co. and Linwood Ventures has sold Sunset & PCH, a 103,786-square-foot office property in the Pacific Palisades, to an unnamed national equity firm for $53 million. The sale was fully marketed and attracted ample interest from a diverse investor pool. The buyer beat out the competition early on by offering a non-refundable deposit.

“The buyers purchased the building to reposition it for sale, and had done a lot of physical renovations to rehab the property,” Bob Safai, president and founding partner at Madison Partners, tells GlobeSt.com. “The market is such that they were able to monetize it and get the return that they were looking for. It ended up being a win-win deal because the buyer wanted to get a foothold in California. This is a really one-of-a-kind piece, and you couldn't reproduce it.” Safai represented the sellers in the transaction along with his colleagues Matt Case and Brad Schlaak. Madison Partners also arranged acquisition financing for the buyer.

In a transaction also led by Safai, the sellers purchased the property 18 months ago for $37 million. Located at 17383 Sunset Blvd., the oceanfront property has three buildings with landscaped courtyards and outdoor seating. It is currently 70% occupied by a tenant mix that includes OneWest Bank, Maui & Sons, Red Bull Global Rallycross and Adamson Associates. Additionally, it is home to the Bay Club, an on-site fitness facility.

“This property plays off of the Santa Monica and Pacific Palisades market. The fact that it has a gym that has been there for 20-plus years and the ocean-view suites makes it very unique in its nature,” Safai says. “It kind of supersedes the market because of its uniqueness. The sellers executed on an aesthetic plan that was desired by the new buyer, who plans to push rents even more than we had.”

Safai has been behind several iconic property sales in the Los Angeles market. Earlier this year, his team made headlines when he sold the Malibu Beach Inn to the Mani Brothers and when he broke pricing records selling a Silicon Beach office property for more than $1000 per square foot.