Blackstone In Talks With Lenders After Write-Down Of Office Asset Once Valued At $583M

Blackstone has written down its stake in a Los Angeles office complex backing $482M in loans.

Called the Playa District, the West Los Angeles property was previously valued as high as $583M, Bloomberg reported. Blackstone is in talks with its lenders to determine the fate of the property, which is 70% leased, according to Real Estate Alert.

Playa District is made up of six Class-A office buildings at 6060 Center Drive near Playa Vista, a hub for tech companies where Apple and Google have offices.

“Given the challenges facing the property, we began writing this property down over 3 years ago and completely wrote it off earlier this year,” a Blackstone spokesperson told Bisnow via email.

Blackstone bought Playa District, also called the Howard Hughes Center, in 2016 as part of a 3M SF office portfolio acquisition from a Hines-sponsored REIT. The other properties in the portfolio were sold off before the pandemic, a Blackstone spokesperson said.

Last month, when the loan on a New York office building Blackstone handed back to its lenders was going up for sale, Blackstone told Bisnow it had written off that building two years ago. It is unclear how many office properties in Blackstone’s portfolio it has written off.

The fund that owns Playa District, Blackstone Real Estate Partners VIII, reported a 15% net internal rate of return in its third-quarter earnings.

Blackstone has largely divested itself of office properties, with its real estate portfolio including mostly logistics, student housing and data center properties, the spokesperson said. Traditional U.S. offices make up less than 2% of Blackstone’s owned portfolio.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

Law Firms Drive Boston Office Rents To Record Highs

3 Houston Office Properties, Vacant To Nearly Full, Change Hands

Spirit Christmas Unveils Plans To Grow Store Count This Holiday Season

Deutsche Hypo Finances Zadelhoff's Amsterdam Offices With €75M Loan

Hurricane Isaias Puts More Than $40B In Multifamily Property In Its Path

Braemar Inches Closer To Ashford Breakup With $372M Hotel Sale

Transformers: Yet Another Data Center Power Infrastructure Supply Chain Bottleneck

SFF Realty Partners Extends Spending Spree With $82M Acquisition In Downtown San Jose

Proposed EPA Rule Change Could Cut Months From Timelines Of Projects Near Wetlands

Drawbridge Realty Acquires 180K SF Office Building In Sunnyvale For $219M

Downtown Los Angeles Retail, Office Hub The Bloc Up For Sale

Distress Divide: How Private vs. Institutional Investors Are Thinking About D.C. Office