Dealmaker: Douglas Emmett Acquires Beverly Hills Office Building for $144M

Douglas Emmett Inc., Los Angeles, acquired Class A office property 9401 Wilshire Boulevard in Beverly Hills. Calif., for $143.6 million, or $981 per square foot.

The 146,300-square-foot property at the corner of Wilshire Boulevard and South Canon Drive is in Beverly Hills’ Golden Triangle submarket. The acquisition increases the real estate investment trust’s ownership share of Beverly Hills Class A office space to 27 percent.

The Los Angeles Business Journal reported Paul Hastings LLP represented the sellers, Cando Partners and Wilshire-Canon Properties.

Douglas Emmett assumed a $32.3 million amortizing loan at 4.55 percent to finance the acquisition. The loan matures in 2038. The firm also used balance sheet cash and issued 2.6 million units in its operating partnership to the seller at an equivalent price of $40.60 per common share to fund the purchase.

Douglas Emmett’s office portfolio now includes 71 properties totaling 18.4 million square feet. The firm also owns 10 apartment communities and is developing additional residential buildings in Los Angeles and Honolulu, Hawaii.

Douglas Emmett also closed a secured, non-recourse $400 million interest-only loan that will mature in December 2024. The loan bears interest at LIBOR plus 1.30 percent, effectively fixed at 3.47 percent through December 2022 via an interest rate swap. The new loan is secured by five office properties. Loan proceeds will retire an existing $365.5 million joint venture loan scheduled to mature in July 2019.