Beats by Dre HQ in Culver City sells for $110M
LABJ 1/16/15 http://www.labusinessjournal.com/news/2015/feb/16/hackman-sells-beats-hq-culver-city/
Hackman Capital Partners, a West L.A. real estate investment and development firm that wagered on creative office space in Culver City nearly a decade ago, has seen its bet pay off.
The company has a deal to sell the Beats by Dre headquarters buildings in Culver City to IDS Real Estate Group in a deal valued at just under $110 million, more than $860 a square foot. Included in the package are two buildings totaling 109,000 square feet occupied by Beats, acquired last year by Apple Inc. in a $3 billion deal, and a 17,800-square-foot property occupied by digital marketing firm Steelhouse Inc. Beats moved to the site last year after signing a 12-year lease valued at an estimated $51 million.
The last substantial deal in the submarket, LBA Realty’s November purchase of the 339,000-square-foot Sony Pictures Plaza at 10000 W. Washington Blvd. in Culver City, clocked in at $159 million, or $470 a foot.
Ryan Smith, managing director at Hackman, confirmed that the properties are in escrow and scheduled to close in March but declined to offer specifics on the transaction.
Representatives of downtown L.A.’s IDS, did not return a call seeking comment.
Hackman collected six warehouses in the Hayden Tract, beginning in 2006, and set about converting them to creative office space.
In an interview with the Business Journal in 2013, Michael Hackman, the firm’s chief executive, said he was taking a long-term approach to the project.
“We believe in Culver City long term,” he said at the time. “We knew in 2006 there would be potential to do some sort of development there, we just weren’t sure how it’d manifest itself over time.”
Smith said selling the properties was always an option, but that “with 12 years of Apple credit” it considered holding the property. In the end, the company decided to sell to an investor who could “coupon clip.”
Hackman purchased the two Beats buildings, at 8600 Hayden Place and 8550 Higuera St., in 2007 for $25.3 million. It acquired the Steelhouse property, 3644 Eastham Drive, in 2012 for $2.8 million, according to Los Angeles County records.
The package was marketed by Eastdil Secured with an assist from First Property Realty Corp. of Beverly Hills, which was the leasing agent for the buildings.
*Shared by Jeff Vertun