Hines Sells Wilshire Office Tower for $225M

Douglas Emmett, Inc., a California based REIT, in partnership with Qatar Investment Authority (QIA) announced the acquisition of a Class A office building in Los Angeles for $225 million, or $616 per square foot. The 19-story building was sold by a fund managed by Hines; Hines acquired the property from Deutsche Asset & Wealth Management for the same amount in 2007 on behalf of its U.S. Office Value Added Fund II, L.P. Douglas Emmett will manage the joint venture and expects to retain a 20% to 30% equity interest, with the remainder held by institutional partners. Eastdil Secured handled the transaction.

Designed by Tracy Price Associates, 12100 Wilshire Boulevard was completed in 1985 and is located at the intersection of Wilshire Boulevard and Bundy Drive in the Brentwood submarket of West Los Angeles. The building features ocean views starting from the second floor, outdoor balconies on the top two floors and an above-market parking ratio. Including known move-outs, the property will be 77% leased at the time of closing, with major tenants including Baum Hedlund Aristei & Goldman, Akana (formerly SOA Software Inc.) and Regus.

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JV Buys $1.34B Los Angeles Office Portfolio

Douglas Emmett, Inc., the California-based REIT, announced that in a joint venture with Qatar Investment Authority (QIA) it had acquired a 1,725,000 square foot office portfolio in Westwood for $1.34 billion, or approximately $777 per square foot. The JV secured a a non-recourse $580 million interest-only loan with a seven-year term in connection with the acquisition. The interest rate is floating at Libor plus 1.40%, which has been fixed at 2.37% annually for five years through an interest rate swap.

Douglas Emmett indicated that it plans to retain 20-30% of the equity in the joint venture, with the remaining interests being held by institutional partners. With this purchase, Douglas Emmett controls 74% of the Westwood Wilshire office corridor, where it already owned One Westwood, 10960 Wilshire, The Tower, 10880 Wilshire, Westwood Place and Westwood Center.

For QIA, this joint venture represents another step in its plans to significantly expand its US investment portfolio, and follows other large investments in real estate, such as in New York City last year. In 2015, QIA announced plans to invest $35 billion in North America over five years.

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QIA Opens NY Office, Commits to Invest $35B in US

The Qatar Investment Authority (QIA), the sovereign wealth fund of the State of Qatar, announced today that it's opening an office in New York and is committed to investing $35 billion in the United States over the next five years. "Honored to join opening of Qatar Investment Authority's office in NY which the Amir entrusted to vanguard our economic cooperation [with] the US," tweeted Mohammed Al Kuwari, Qatar's Ambassador to Washington D.C. The decision to open an office in New York is indicative of QIA's confidence in the country's long-term economic growth and investment prospects, and allows the opportunity to strengthen partnerships with both public and private sector organizations, according to a press release from QIA. The Sovereign Wealth Fund Institute estimates the QIA manages some $256 billion in investments.

The fund, founded in 2005, and other Qatari government-linked investors traditionally have invested heavily in Europe, snapping up headline-grabbing trophies such as stakes in prominent London properties and the Paris Saint-Germain soccer team, according to a Star Tribune report. The QIA's existing American holdings include a more than 10-percent stake in New York-based luxury jeweler Tiffany & Co At the opening of the New York office, HE Sheikh Abdulla Bin Mohammed Bin Saud Al-Thani, the CEO of QIA, said: "With boots on the ground, our presence in New York will anchor our interest in the region. It is the perfect location to help strengthen our existing relationships and promote new partnerships as we continue to expand geographically, diversify our assets and seek long term growth."

The Doha-based fund has deployed the nation's riches on assets ranging from British bank Barclays Plc to Total SA and commodities trader Glencore Plc, with most of its investments so far confined to Europe, according to a Bloomberg report. "QIA has traditionally preferred Europe and is now looking to source more deals in the U.S.," said Enrico Soddu, head of data and research at the London-based Sovereign Wealth Center. "Middle Eastern sovereign-wealth funds have often struggled to source direct deals in the States," he added, noting that QIA has nevertheless already made some investments in the U.S. including buying a stake in movie distributor Miramax. QIA said it also "remains committed to its investments in Europe, Asia and the Middle East," while the New York office "facilitates access to significant investment opportunities".

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