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CALIFORNIA / News and Insight on Business in the
Golden State

Starwood to Pay $77 Million for Figueroa Plaza Downtown

January 15, 1998|MELINDA FULMER | SPECIAL TO THE TIMES

With a bid of more than $77 million, investment advisor Starwood Capital Group has been selected to purchase Figueroa Plaza, a two-tower complex in downtown Los Angeles.

The buyers are a partnership of Greenwich, Conn.-based Starwood and the building's original developer, Raffi Cohen. They were selected in a sealed bid sale this week, said brokers Drew Hild and Barry Beitler of Beitler Commercial Realty Services, which marketed the building for owner Lexington Commercial Holdings, a Los Angeles investment firm headed by aircraft-leasing mogul Lou Gonda.

Sources close to the deal say the group will pay more than $77 million for 615,000 square feet, a premium price for a property not located on a preferred downtown corner.

"It's a vote of confidence in downtown by Wall Street and other institutional investors," Hild said. "The price went higher than the seller thought it would go."

A sales contract is expected to be signed in the coming week, a Lexington representative said. The deal could close as early as March, Beitler said.

Starwood is a privately held investment firm headed by Starwood Hotels & Resorts Trust Chairman Barry Sternlicht that invests money on behalf of wealthy individuals and companies. Starwood officials declined to comment on the sale.

Cohen built the first of the two towers in 1986; the second followed in 1991. He lost his ownership stake in the once-troubled project years ago as vacancy soared and lease rates dipped. In 1996, he was replaced as manager and leasing agent by Cushman & Wakefield.

The granite-clad towers at 201 and 221 N. Figueroa St. are 100% and 98% leased, respectively. Major tenants include the city of Los Angeles, law firm Lewis D'Amato Brisbois & Bisgaard and MedPartners Inc.

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