EL SEGUNDO, CALIF. — TA Realty has acquired 101 Continental, a soon-to-be-vacant office tower in El Segundo, for $138.5 million or $400 per-square-foot. VEREIT Inc. (NYSE: VER) sold the property.
Developed by Continental Airlines in 1972, the 340,000-square-foot property was upgraded in 2008. The building is fully leased to Northrop Grumman and features floor-to-ceiling glass on every floor and unobstructed ocean views. TA Realty plans to begin a comprehensive building renovation at the end of May when Northrop Grumman’s lease expires. A timeline for the completion of the renovation was not disclosed.
The property is located at 101 Continental Blvd., 18 miles southwest of downtown Los Angles and two miles south of Los Angeles International Airport.
Selling 101 Continental decreases VEREIT’s office exposure and strengthens its overall portfolio, according to Thomas Roberts, chief investment officer of the company. As of Dec. 31, 2018, VEREIT managed and owned a 4,000-property, 95 million-square-foot portfolio that spanned across retail, office, restaurant and industrial space in 49 states.
When Phoenix-based VEREIT purchased the property in 2014 for $98 million, it was fully leased to Northrop Grumman. VEREIT engaged Newmark Knight Frank (NKF) to market the property as a redevelopment opportunity.
“The opportunity to acquire a vacant Westside office asset of this caliber is extremely rare,” says Laura Stumm, senior managing director of NKF. “TA Realty’s repositioning of 101 Continental will provide much needed creative inventory to a quickly tightening Class A office market in El Segundo.”
Stumm, Kevin Shannon, Ken White, Rob Hannan and Michael Moll of NKF represented the seller, while the privately owned buyer was self-represented in the deal.
VEREIT’s stock price closed Wednesday at $8.23 per share, up from $6.81 per share a year ago.
— Amy Works and Alex Tostado