$215M Offer from LA County for DTLA Gas Company Tower
Los Angeles County is on the brink of acquiring one of the city's tallest office towers, as multiple reports suggest. The County has made a $215 million offer for the Gas Company Tower, a 52-story building at 555 W. 5th Street. According to the Los Angeles Times, this acquisition would allow county workers to vacate existing buildings, including the iconic Kenneth Hahn Hall of Administration.
Situated across from Pershing Square, the 52-story tower, completed in 1991, encompasses approximately 1.4 million square feet of office space. Like other prestigious towers in the area, it has struggled to retain tenants post-pandemic, with occupancy plummeting to about 50 percent. Remaining tenants include Southern California Gas Co., Deloitte, and Latham & Watkins.
As a result, The Times notes that the proposed $215 million purchase price is significantly below the $632 million valuation the Gas Company Tower received in 2020. Commercial Observer reports that the County intends to pay this reduced price in cash.
The County's acquisition of the tower for its offices may disrupt earlier plans by the City of Los Angeles to lease around 300,000 square feet of space within the building.
The implications for the County's portfolio of 33 buildings requiring seismic retrofits, including the Hall of Administration, remain uncertain.
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