Brookfield Properties is selling 777 South Figueroa Tower, formerly one of its trophy office towers in Downtown Los Angeles, for about half of the outstanding debt on the property.
South Korea-based investment firm Consus Asset Management is in a deal to buy the 1 million-square-foot tower for about $145 million, according to reports from Bloomberg and Real Estate Alert, which cited unidentified sources. Brookfield did not immediately respond to a request for comment.
If the deal closes at that price, it will come out to about $145 per square foot, in line with other Downtown L.A. office trades in the last year.
Brookfield defaulted on $319 million in loans tied to the 52-story tower last year, after rising interest rates squeezed profits from the building. The firm put the property up for sale in the fall.
Sources previously told TRD that Brookfield had received at least 15 offers on the tower, which is about 52 percent leased.
Brookfield’s sale serves as another marker for office landlords and brokers in Downtown L.A., suggesting the submarket — severely hit by remote work, high office vacancies and loan defaults — is close to bottoming out.
In December, Carolwood, run by Adam Rubin and Andrew Shanfeld, bought the 1.1 million-square-foot AON Center at 707 Wilshire Boulevard for $147.8 million, or about $134 per square foot.
That sale was technically a deed-in-lieu of foreclosure and relieved the seller, Shorenstein Properties, of its unpaid debt on the tower.
Brookfield has defaulted on a total of $1.1 billion in debt tied to Downtown L.A. office towers since last February. Two other Brookfield-owned buildings Downtown, the Gas Company Tower and EY Plaza, are both in court-appointed receiverships.
“It’s just regular business. It’s small and not relevant to the overall business,” Brookfield Asset Management CEO Bruce Flatt said of the defaults last year.
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