Iconic Mixed-Use West Hollywood Property for Sale

Wednesday, August 31, 2016

Update: This property is no longer on the market since it sold. Click here to read details on the HFF-brokered sale.

HFF, on behalf of the owner, is marketing for sale The Sunset, an iconic, experiential, mixed-use destination campus located on the world famous Sunset Boulevard in the heart of West Hollywood, California.

The Sunset from HFF on Vimeo.

Totaling 178,699 square feet, The Sunset is situated on 2.22 acres at 8560-8590 West Sunset Boulevard in the western part of Los Angeles. The commercial property for sale comprises four buildings that are currently 90.4 percent leased, including a preeminent, 10-story, 71,875-square-foot, Class A office tower with a two-level, 25-stall subterranean parking garage; a three-building high-end retail and office complex totaling 106,824 square feet with a four-level, 906-stall shared underground parking garage. The total available parking spaces to the property is 931 stalls, resulting in a parking ratio of 5.21:1,000 square feet. 

The office tower has undergone a multi-million dollar capital renovation, including a new exterior skin designed by the renowned Nadel Architects. It features incredible views from the Pacific Ocean to downtown Los Angeles, modern finishes, upgraded lobby and flexible floor plates. For four consecutive years, the tower was awarded an Energy Star label, and it earned LEED Gold certification in 2013. The retail plaza is anchored by an Equinox that consistently ranks as one of their best-performing gyms nationally. Additional tenants include H&M, which is the second largest global clothing retailer; SoulCycle; Oliver Peoples; Wag! and Café Primo. In addition to the retail space, H&M uses a portion of the second floor plaza space as their West Coast real estate headquarters and showroom.

The Sunset provides a unique diversification of cash flow attained through the commercial retail and office component, parking and billboard/signage advertising opportunities. The rapidly-urbanizing Sunset Strip, L.A.’s equivalent of Times Square, has experienced an unprecedented explosion of upscale residences, shopping, dining and hotel development that benefit the property. The nearly 420 feet of street frontage on Sunset Boulevard, combined with its central West Hollywood location, contributes to the property’s brand as a world class mixed-use experiential destination. The walkable amenity base and unique position within an evolving market will solidify The Sunset as an ideal location for office and retail tenants alike.

Mixed-Use Property for Sale Investment Benefits

  • Proximity to Affluent Demographics:  The Sunset’s central West Hollywood location adjacent to Beverly Hills, proximity to entertainment giants and affluent surrounding demographics has attracted a critical mass of talented young workers into the market, giving businesses in the area a competitive advantage. Hollywood Hills, an affluent neighborhood popular with celebrities, achieves average home prices over $5 million, with some neighborhoods averaging $20 million and current listings exceeding $70 million.
  • Robust Leasing Momentum:  Since 2014, the West Hollywood office market has experienced significant net absorption of over 400,000 square feet, totaling plus or minus 16 percent of the Class A inventory. With minimal office supply under construction, office market fundamentals are forecast to remain vigorous with current office rents rivaling downtown Santa Monica and the Beverly Hills Triangle.
  • Highly-Desirable Billboard and Signage Advertisement Space:  The Sunset presents a unique opportunity to drive value through signage revenues. The mixed-use property for sale features numerous, highly-visible, signage options in one of the nation’s most prominent advertising markets, aptly considered the “Times Square” of the West Coast. The Sunset Strip ranks as the fifth most visited tourist destination in Los Angeles, with more than one million visitors per year who spend nearly $1 billion annually in West Hollywood. Over 105,000 vehicles pass in front of the property each day. Potential additional digital and billboard development exists. Note that the tall wall signage on the office tower are subject to an easement and excluded from this offering.
  • Diversified Cash Flow with Upside Potential:  Only 12.3 percent of tenants in occupancy expire through March 2020, providing investors a stable near-term and diversified income stream. An immediate value-add opportunity exists through the lease-up of the 17,143 square feet of vacant space. A total of 69.3 percent of the existing tenants expire between 2020-2023 with average in-place rents 26 percent below market, presenting a significant mark-to-market opportunity to generate an incremental $2 million in NOI.

As companies continue to use real estate as a recruitment and retention tool to attract the best-of-the-best talent, The Sunset offers an unrivaled mixed-use experiential campus in an iconic location within walking distance of everything the famous Sunset Strip has to offer. For more information on this mixed-use property for sale in West Los Angeles or other investment opportunities in Southern California, contact Michael Leggett, Ryan GallagherAndrew Harper or Bryan Ley in HFF’s Los Angeles and Orange County offices.

Holliday Fenoglio Fowler, L.P., acting by and through Holliday GP Corp., a real estate broker licensed with the California Department of Real Estate, License Number 01385740.

By Topics