Griffin Capital Essential Asset REIT Sells Office Building for $63.5 Million
November 26, 2019
Griffin Capital Essential Asset REIT, Inc. recently sold a 151,289 square foot, Class “A”, three-story office building located at 2160 Grand Avenue, El Segundo, California for $63.5 million or $420 per square foot. Purchased by the REIT in February 2014 for $52.7 million, the Property was originally 100 percent leased to a single-tenant with a lease expiration of June 30, 2021. As part of the transaction, the REIT delivered the property unencumbered by this lease.
The REIT made a strategic decision to position the property for sale based on investor demand. Recognizing that value-add buyers prefer vacant buildings, the REIT’s team bought out and terminated the sole tenant’s lease and did so on an accretive basis. The combination of an attractive buyout and a simultaneous sale, ultimately drove a strong return for the REIT.
Michael Escalante, Chief Executive Officer of the REIT stated, “Since the REIT’s acquisition, the El Segundo office submarket has benefitted from outsized tenant demand in the city’s Lower Westside markets, drawing to El Segundo a larger and more diverse tenant base than had historically been interested in the location, resulting in material growth in both office rental rates and institutional capital investment. We believed the Property would ultimately be the beneficiary of this growth, and that original acquisition thesis was proven correct by the economics of this sale transaction.”
The building was purchased by SteelWave, a full-service commercial, multifamily and mixed-use real estate management, operating company and investment management firm.
About Griffin Capital Essential Asset REIT
Griffin Capital Essential Asset REIT, Inc. is a self-managed, publicly registered, non-traded REIT with a portfolio consisting primarily of single tenant business essential properties throughout the United States, diversified by corporate credit, physical geography, product type, and lease duration. Griffin Capital Essential Asset REIT, Inc.’s portfolio, as of September 30, 2019, consisted of 101 office and industrial properties totaling 27.1 million rentable square feet, located in 25 states, representing total REIT enterprise value of approximately $4.7 billion.
Source: Griffin Capital Essential Asset REIT, SEC, Blue Vault
