One Wilshire, the premier carrier hotel in Los Angeles, has changed hands. Global private equity firm The Carlyle Group said Monday that it has sold the landmark telecom building to Hines REIT for $287 million. That works out to $432 a square foot for the 664,248 square foot building.
One Wilshire is one of the best-known telecom buildings in the country, with 62 percent of the property occupied by communications companies including Verizon Communications, Savvis, Level 3, Global Crossing, Qwest Communications, Pac-West and Carlyle Subsidiary CRG West. Carlyle reportedly paid $119 million for the building in 2001 and spent $30 million on infrastructure improvements, including additional generators and upgrades to the building's electrical system.
"One Wilshire is an outstanding investment for the Hines REIT," said Charles Hazen, president of Hines, a Houston-based real estate investment firm. "This acquisition allows us to expand our portfolio in one of our primary target markets, and in addition acquire one of the world's premier telecommunications assets."
"Carlyle is pleased to have created lasting value at One Wilshire during its ownership," said Thomas M. Ray, managing director of The Carlyle Group. "The combination of first-class office space and an incredible density of global carriers make One Wilshire a unique asset. The first-class professional management and leasing capabilities of Hines make it an outstanding buyer and owner of the Building."
Carlyle subsidiary CRG West, one of the largest managers of network-neutral data centers in the United States, will continue to lease more than 170,000 square feet. CRG , which has managed the building since 2001, is the largest tenant at One Wilshire and will continue to provide colocation, interconnection and peering services there.
"One Wilshire is a special building and plays an important role in global communication,"said John Savageau, managing director of CRG West. "We look forward to working with Hines in the future to continue meeting the needs of companies from around the world. The sale of the One Wilshire base building will allow CRG West to focus on its core competency of providing managed power and peering opportunities to the world's leading content delivery networks and service providers."
CRG West has just opened an additional 25,000 square feet of colocation space on the 27th floor and will release an additional 15,000 square feet in early 2008.
The Carlyle Group is a global private equity firm with $71.4 billion under management. Since 1987, the firm has invested $28.3 billion of equity in 636 transactions for a total purchase price of $132.0 billion. Carlyle portfolio companies have more than $87 billion in revenue and employ more than 286,000 people around the world.