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Office and studio landlord Hudson Pacific Properties plans to sell four “non-strategic” office properties, including two in Southern California, President Mark Lammas told investors on an earnings call Thursday.
“For all these assets, either the location, tenancy or asset quality is no longer a fit for our strategy,” Lammas said.
The money would be better spent on building out the company’s development pipeline or acquiring new projects, he said.
The properties that the Westside-based REIT is looking to sell include a 12-story Hollywood office building at 6922 Hollywood Blvd.; the five-story Del Amo property in Torrance at 3501 Sepulveda Blvd.; a building in San Carlos, California; and another in Lynwood, Washington. CoStar was the first to report the impending sale of the properties.
Together, the properties amount to about 745K SF — a small portion of Hudson's total 20M SF portfolio, according to CoStar. The Hollywood Boulevard property is about 72% occupied, and the Del Amo property is 100% vacant. Overall, the company’s stabilized office portfolio is about 93% occupied.
“I think with these four assets [sold], if we execute on it, it will take some of the exposure away from some of the future vacancy in the portfolio,” Hudson Pacific Chairman and CEO Victor Coleman said.
Hudson Pacific has focused on studio space in recent years, entering into a $1.6B joint venture with Blackstone in 2020 to expand that section of its business. According to CoStar data, it is the third-biggest owner of production-related space in the greater LA area. Construction has begun on its latest studio project, the 240K SF, $190M Sunset Glenoaks, in the San Fernando Valley.
Its office business has also been brisk. The company announced in its earnings call that it is expecting to sign a lease shortly for the remaining 60K SF at its Hollywood office project Harlow and that it handed over One Westside to Google for tenant improvements in late 2021.
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