Hollywood's Sunset Media Tower to Be Sold in Major Deal
The Sunset Media Tower, the Hollywood home of several entertainment and media companies, is set to trade hands in what would be one of the neighborhood's biggest commercial real estate sales in recent years.
The 22-story building at 6255 Sunset Blvd. would be sold by its nearly three dozen individual owners to Kilroy Realty Corp., a West Los Angeles real estate investment firm, for about $76.5 million, according to sources with knowledge of the Hollywood office market. Though the deal has not been inked, it is expected to be signed shortly and the transaction would close by the end of summer.
The property boasts a tenant roster that includes television production company Magical Elves Productions; Associated Production Music, a music library and music services company; and Nielsen Media Research, a unit of Nielsen Co., the former owner of The Hollywood Reporter.
The property, one of Hollywood’s largest office buildings, also serves as the corporate headquarters of lingerie company Frederick’s of Hollywood and until recently was home to the main offices of the House of Blues.
The 320,892-square-foot building is owned by 34 investors through a tenancy-in-common arrangement, an ownership structure that allows individuals to jointly hold real estate. Irvine, Calif.-based PASSCO Cos. manages the asset on behalf of the investors.
The property was listed without an asking price, though sources told the Reporter in November that the building could fetch upward of $80 million. At $76.5 million, the building would trade hands for $238 per square foot. During the real estate boom, quality Los Angeles office buildings typically sold for more than $300 per square foot, though prices have come down well below that benchmark since the economic collapse.
THR reported in November that the departure of House of Blues, which in April 2010 relocated its headquarters from the Sunset Media Tower to nearby at 7060 Hollywood Blvd., led the owners to list the property. The concert venue operator, a subsidiary of Live Nation Entertainment, had occupied about 70,000 square feet, making it the tower’s biggest tenant.
The Class A building, which is just east of Sunset and Vine, was built in 1971 and renovated in the late 1990s. It is two blocks from the newly opened W Hollywood Hotel & Residences.
Nielsen, the biggest tenant, leases roughly 40,000 square feet at the building; other large tenants include Magical Elves, which leases about 30,000 square feet, and Frederick’s with about 25,000 square feet. The property is roughly 25 percent vacant.
Though Kilroy has not traditionally been a player in the Hollywood office market, the property makes sense for the company because it falls in line with its other entertainment office properties. The company owns Westside Media Center, a West L.A. office complex at 12200 W. Olympic Blvd. that is home to Hulu, Mark Gordon Co. and Fandango. It also owns 2100 Colorado Ave. in Santa Monica, where Universal Music Publishing Group is a tenant.
Carl Muhlstein and Stephen Algermissen, the Cushman & Wakefield Inc. commercial real estate brokers who have the listing, could not be reached for comment. Kilroy did not return phone calls seeking comment. PASSCO could not immediately be reached for comment.