- JLL will handle the marketing of the 52-story Gas Company Tower in Downtown LA, currently under court-appointed receivership.
- The sale will require court approval, and JLL will earn a success fee based on the sale amount, ranging from 0.5% to 0.8%.
- The City of Los Angeles is interested in purchasing the tower to secure office space but faces competition from other potential buyers.
JLL, a global real estate services firm, has been enlisted to market the Gas Company Tower, a 52-story high-rise located at 555 West 5th Street, for sale.
This move follows a court filing that appointed Trident Real Estate’s Gregg Williams as the property receiver. The receiver holds the authority to list the property for sale, with JLL spearheading the marketing efforts led by brokers Jeffrey Bramson, Andrew Harper, and Will Poulsen.
Marketing an Icon
JLL’s success fee will depend on the final sale price of the building. If the tower sells for between $150 million and $194.99 million, JLL will earn a 0.5% fee. If the final price is $220 million or above, the success fee increases to 0.8%. However, if the building is sold to the City of Los Angeles or the county, JLL will receive a flat 0.5% fee.
Off to The Races
The Gas Company Tower came under receivership after its previous owner, Brookfield, defaulted on $350 million in loans. CMBS bondholders subsequently filed a lawsuit to request the court appointment of a receiver. Williams and his team believe that an open market sale will yield a higher return than foreclosure, particularly given the current interest from the City of Los Angeles.
However, the listing needs to be completed promptly to ensure the best chance of securing the city’s lease and maximizing the property’s value.
The City of LA is already negotiating a 300K SF lease deal at the tower. But failing to strike a deal soon could also result in the tower’s CMBS bondholders pursuing foreclosure.
