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BEVERLY HILLS, CA-A buyer from Hong Kong has acquired the Hugo Boss building at 414 N. Rodeo Dr. for $28 million at one of the highest prices per net rentable square foot ever paid in L.A., according to listing broker Orbell Ovaness, a senior investment adviser at National Equity Advisors Inc. in Encino. Ovaness tells GlobeSt.com that the building totals 11,333 square feet of gross leaseable space and 9,638 net rentable square feet, meaning the transaction closed for nearly $3,000 per square foot on a net rentable basis.

Ovaness represented the seller, the Spanish porcelain figure company Lladro, which maintains its US headquarters in New Jersey. The seller was also represented by David Feldman, sales manager of the Atlanta office of Marcus & Millichap, who was an agent in the West L.A. office of the firm at the time the property was listed. The Hong Kong investor, Allied Golden, paid all cash for the property.

Ovaness explains that property owners are able to achieve extraordinary prices per square foot for the sale of buildings on Rodeo Drive because high-profile retail tenants are willing to pay extremely high rents to maintain a presence along the world-renowned shopping district. Having a presence on Rodeo Drive is considered a form of advertising for many retailers, he points out.

Ovaness tells GlobeSt.com that the property was marketed on a confidential, exclusive basis to a select group of prospective buyers. He says that one of the challenges in marketing the building was financing because lenders wanted to underwrite the deal at cap rates in the 12% range, so that finding an all-cash buyer was a better solution.

The Hugo Boss building was built in 1997 and had not traded since then. It has been occupied by Boss throughout that time.

“These properties very rarely come onto the market,” Ovaness says. In addition to occupying a place on the exclusive retail street, the Hugo Boss building is one of the few parcels on Rodeo Drive with subterranean parking, Ovaness points out.

The 414 N. Rodeo transaction represents the highest price per square foot paid for a building in Los Angeles since the sale of the Max Mara building on Rodeo Drive in 2007, according to Ovaness. Although he was not involved in the Max Mara building sale, Ovaness was a broker on the sale of the Banana Republic Building in the Golden Triangle district of Beverly Hills in 2007. The 13,500-sf building at 357 N. Beverly Blvd. sold for $30 million, or $2,222 per square foot.

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