Bixby Land Company, a leading commercial real estate operator and investment manager based in Orange County, Calif., has purchased the 291,711-square-foot South Bay Tower in the South Bay submarket of Los Angeles from TA Associates for $52 million, or $178 per square foot. Bixby's purchase of the eight-story Class-A office tower marks the firm's continued strategy to acquire value add investment opportunities in California. The new owner plans to invest an additional $6 million in the property to improve the lobby, common areas and landscaping.
South Bay Tower was built in 1988 and is considered one of the top office buildings the South Bay market. Located on 6.2 acres at 21250 Hawthorne Blvd. in Torrance, Calif., the LEED-certified and Energy Star-rated building caters to professional service firms. Major tenants in the building include Bank of America, Wells Fargo Insurance, Morgan Stanley Smith Barney and the Daily Breeze.
"Bixby's acquisition of South Bay Tower represents a strategic value add investment in one of the highest quality office buildings in the submarket," said Bill Halford, president and CEO of Bixby Land Company. "The building quality provides a unique option for companies seeking high identity office space in the South Bay market."
The $52 million purchase price is roughly 50% of replacement cost estimates, and at 63% occupancy, South Bay Tower has significant upside potential for Bixby. The building provides floor sizes that range from 24,000 square feet to 47,000 square feet. Bixby is infusing new capital to create make-ready office suites in the 2,000 to 10,000-square-foot range.
The amenities available at South Bay Tower are among the best in the South Bay market. The building features an attractive park-like setting with mature landscaping, a central fountain and outdoor seating areas. South Bay Tower has excellent access to abundant retail amenities along the Hawthorne Blvd. corridor, including the adjacent Del Amo Fashion Center. Parking is available in a five-story parking structure, and the building is located close to executive housing in nearby Manhattan Beach and the Palos Verdes Peninsula.
The investment follows a surge of activity at Bixby Land Company over the past 60 days. Bixby has completed approximately 400,000 square feet of newly renovated office space in two Silicon Valley properties during that time, one of which is already fully leased in a transaction valued at $25 million. Bixby's investment strategy continues to position the firm's 6 million-square-foot portfolio of office and industrial properties with more value add opportunities.
"We continue to seek ways to improve the value of our portfolio holdings through the strategic acquisition of properties that provide significant upside in value," said Halford.
About Bixby Land Company
Bixby Land Company is a leading commercial real estate operator and investment manager with a portfolio of assets under management nearing $1 billion. The company is a privately-held REIT that owns core industrial and value add investments in R&D and office properties throughout the Western U.S. Bixby Land Company has a vertically integrated operating platform backed by a veteran management team. For more than 100 years, Bixby Land Company has been committed to adding value for its investors and shareholders.