By Barbra Murray
Hudson Pacific Properties Inc. kicks off 2018 with the announcement of agreements to trade four office assets in California. The company will sell the 370,000-square-foot collection to separate buyers for an aggregate $254.8 million.
Timing is everything. “We are taking advantage of very favorable market conditions to sell four non-core assets,” Victor Coleman, chairman & CEO of Hudson Pacific Properties Inc., said in a prepared statement. The office properties may be the wrong fit for Hudson, but they’re still located in what are arguably considered to be prime locations. The group includes three Northern California properties—two in metropolitan Palo Alto, and another in the San Francisco Peninsula submarket—as well as a building in a premier Los Angeles sub-market.
In the Palo Alto area, 2180 Sand Hill, a 45,600-square-foot office building in Menlo Park, will fetch $82.5 million, and roughly five miles to the east in Palo Alto proper, the 197,400-square-foot Embarcadero Office Campus will bring in $136 million. Additionally, in San Mateo, the 63,000-sqsure-foot Building 6 in Peninsula Office Park will be sold for $22.5 million. Hudson came into possession of the three assets in 2015 with its $3.5 billion acquisition of Equity Office Properties’ 8.2 million-square-foot San Francisco Peninsula and Silicon Valley office portfolio from Blackstone Real Estate Partners.
Rounding out the group of planned dispositions is 9300 Wilshire Blvd. in Beverly Hills. Hudson bought the 61,400-squre-foot building in 2010, and will sell it for $13.8 million.
There’s nothing like cash on hand for doing a little shopping. “These transactions give us additional capital for new, value-add opportunities that will help drive our company’s growth in 2018 and beyond,” Coleman added. Hudson plans to utilize proceeds from the four asset sales to acquire at least one property the company has in mind for a like-kind exchange.
As for additional purchases in 2018, well, Hudson has had its eye on more than traditional office assets over the last decade. The company made its entrée into the Hollywood studio market by snapping up Sunset Gower and Sunset Bronson studios in 2007 and 2008, respectively. In May 2017, the company bolstered its standing as the largest independent owner-operator of sound stages in the U.S., with the $200 million purchase of Hollywood Center Studios, a 369,000-square-foot media and entertainment campus that has since been renamed Sunset Las Palmas Studios.
All four of Hudson’s planned property sales are on track to reach completion by the end of January 2018.
Image courtesy of Yardi Matrix