LOS ANGELES—Intercontinental Real Estate Corp. just made a big buy in the El Segundo market. The investor has purchased the Apollo at Rosecrans, a four-building 546,833-square-foot creative office building, from Invesco Real Estate and Second Street Ventures. The sales price was not disclosed, but industry sources tell GlobeSt.com that the purchase price was more than $320 million.
“Apollo at Rosecrans' prime location in one of the fastest-growing submarkets of Los Angeles immediately attracted us to this opportunity,” Jessica Levin, director of acquisitions at Intercontinental Real Estate Corp., tells GlobeSt.com. “El Segundo has emerged as one of the premier tech-hubs and creative entertainment centers in southern California, and we recognized the opportunity to capitalize on the long-term growth that this region affords. Apollo is perfectly positioned to perform well over time. Currently, this submarket has rents about 20 percent below areas such as Santa Monica and Venice, meaning that Apollo is poised for excellent long-term rent growth.”
While the market was the impetus for the purchase, the property was also recently updated in 2015 and features ample amenities, like a basketball court, dog park, biking and walking trails, shower facilities, an outdoor fireplace and a parking structure. “Apollo benefits from its state-of-the-art renovations that exemplify the on-going trend of creative office space,” says Levin. “Apollo precisely caters to this demand through its creative office large open floorplates and its tech-oriented build outs encourage collaboration and innovation. In addition, the campus environment cultivates a creative and work/play atmosphere.”
The property commands the highest rents in the immediate submarket and is 98% occupied; however, there is still plenty of room for growth over the long term. “We plan to drive rent growth through a proactive leasing management platform to lease up the remaining vacancy,” adds Levin. “Because we have purchased this as a long-term hold, we intend to provide strategic and proactive asset management, as well as highly responsive property management to meet our tenant's needs on an ongoing basis. Market fundamentals remain strong, as the El Segundo office market continues to experience positive net absorption and low vacancy rates.”
This in Intercontinental's first purchase in the El Segundo market; however, it owns another creative office property in neighboring Culver City, both of which make up the Silicon Beach area. “Both Culver City and El Segundo are part of the rapid growth of Silicon Beach,” says Levin. “We are, in fact, seeking additional property acquisition opportunities in this market.”
CBRE and Kevin Shannon of Newmark Grubb Knight Frank represented the sellers in the transaction.
LOS ANGELES—Intercontinental Real Estate Corp. just made a big buy in the El Segundo market. The investor has purchased the Apollo at Rosecrans, a four-building 546,833-square-foot creative office building, from Invesco Real Estate and Second Street Ventures. The sales price was not disclosed, but industry sources tell GlobeSt.com that the purchase price was more than $320 million.
“Apollo at Rosecrans' prime location in one of the fastest-growing submarkets of Los Angeles immediately attracted us to this opportunity,” Jessica Levin, director of acquisitions at Intercontinental Real Estate Corp., tells GlobeSt.com. “El Segundo has emerged as one of the premier tech-hubs and creative entertainment centers in southern California, and we recognized the opportunity to capitalize on the long-term growth that this region affords. Apollo is perfectly positioned to perform well over time. Currently, this submarket has rents about 20 percent below areas such as Santa Monica and Venice, meaning that Apollo is poised for excellent long-term rent growth.”
While the market was the impetus for the purchase, the property was also recently updated in 2015 and features ample amenities, like a basketball court, dog park, biking and walking trails, shower facilities, an outdoor fireplace and a parking structure. “Apollo benefits from its state-of-the-art renovations that exemplify the on-going trend of creative office space,” says Levin. “Apollo precisely caters to this demand through its creative office large open floorplates and its tech-oriented build outs encourage collaboration and innovation. In addition, the campus environment cultivates a creative and work/play atmosphere.”
The property commands the highest rents in the immediate submarket and is 98% occupied; however, there is still plenty of room for growth over the long term. “We plan to drive rent growth through a proactive leasing management platform to lease up the remaining vacancy,” adds Levin. “Because we have purchased this as a long-term hold, we intend to provide strategic and proactive asset management, as well as highly responsive property management to meet our tenant's needs on an ongoing basis. Market fundamentals remain strong, as the El Segundo office market continues to experience positive net absorption and low vacancy rates.”
This in Intercontinental's first purchase in the El Segundo market; however, it owns another creative office property in neighboring Culver City, both of which make up the Silicon Beach area. “Both Culver City and El Segundo are part of the rapid growth of Silicon Beach,” says Levin. “We are, in fact, seeking additional property acquisition opportunities in this market.”
CBRE and Kevin Shannon of Newmark Grubb Knight Frank represented the sellers in the transaction.
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