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TCW Group is expected to vacate its namesake TCW Tower in Downtown LA in two years, reports indicate, at which point the asset management firm will move into one of the two towers that make up City National Plaza a mile away from the TCW skyscraper.
The move won’t happen until 2024, when TCW’s lease at its current home ends, according to Commercial Observer, which cited unnamed sources. The relocation to Fifth and Flower streets will represent a slight downsizing; TCW will take 140K SF at one of the City National Plaza towers, a 40K SF reduction from its current footprint at TCW Tower, CO said.
City National Plaza is owned by California Public Employees’ Retirement System and CommonWealth Pacific Capital. The joint venture purchased the property in 2013 from CalSTRS for $858M, the Los Angeles Business Journal reported. The TCW Tower, a 37-story skyscraper at 865 South Figueroa St., was completed in 1990 and is owned by Manulife Investment Management. City National Plaza was built in the 1970s but underwent a renovation in 2018.
TCW Group declined to comment, and representatives for the owners of City National Plaza did not respond to Bisnow's request for comment.
The downsizing comes as Downtown LA's office market sluggishly recovers from the pandemic. The market saw occupancy drop at the end of the year, with nearly 60K SF coming back on the market in Q4 2021, according to Cushman & Wakefield.
Leasing activity for the submarket in 2021 totaled 1.1M SF, due in part to larger deals like Adidas’ 100K SF lease in the Fashion District. The area still saw negative net absorption of about 160K SF in the last quarter of the year and ended the year with a 25% vacancy rate, C&W found.
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