L.A.’s Westside Pavillion Mall to Convert to Creative Office Space
iStock photo of Westside Pavillion in Los Angeles
In one of the biggest single-building office leases in modern Los Angeles history, internet titan Google has a new address, 10850 W. Pico Blvd, home of the former Westside Pavilion Mall. Real estate investment trust Hudson Pacific Properties and Santa Monica, California based mall owner, Macerich have teamed together to revamp the aging mall into modern office spaces – of which Google will occupy over half a million square feet – 584,000 square feet.
According to CoStar, this deal is the second largest in square footage office rental in Los Angeles history, second only to DirecTV Group Inc.’s single office lease in El Segundo in 2011, whose headquarters comprise of 630,000 square feet in the three Kilroy Realty Corp’s office buildings.
This deal marks a hot, growing market for Silicon Valley-based technology companies leasing in Los Angeles. Facebook, Apple, Amazon, Netflix and Google are all looking to expand their online entertainment and marketing in Los Angeles’s booming entertainment industry. Apple and Amazon are both expanding in Culver City, about one mile west of Google’s new West LA location. Just last month, Amazon leased two more buildings at Culver Studios, owned by Los Angeles developer Hackman Capital Partners, doubling their entertainment production space to 530,000 square feet. Apple’s entertainment division has also leased office space in Culver City at 8777 Washington Blvd. “Google’s selection of One Westside demonstrates the strength of the Los Angeles tech and media industries and exemplifies the type of creative office space that is in demand from large tech and media tenants,” Victor Coleman, chairman and chief executive of Hudson Pacific Properties, said in a statement.
The uniqueness of the property as well as its proximity to freeways (easy access to both the 405 and the 10 freeways) could be the appeal for Google and its desire to attract the best talent to its company. According to Steve Basham, senior market analyst at CoStar Group, “It’s unusual for creative office space of that size to become available at once,” Basham said. “Location-wise it has to be all about talent in the area with big tech companies expanding their footprint.”
Others in the industry agree with Basham. Colliers International’s executive vice president, Nico Vilgiate quoted in an email, “the large availability in itself is difficult to find in West L.A. plus it also offers Google a unique low-rise envelope which they can convert in a very unique way similar to their newly opened Spruce Goose location in Playa Vista. This expansion location is much more central than Playa Vista to the heart of Los Angeles.” Referencing that a few months ago Google moved into a 319,000 square foot unique space at Howard Hughes’ Spruce Goose. He said the centralized location and project’s scale are the "difference makers at the end of the day." Vilgiate is not involved with the Google deal.
Westside Pavilion has been struggling as an indoor mall for quite some time, as retailers struggle and big box anchors close shop or leave to focus on their online sales or pursue other locations. Last March, Macerich, who has owned property since 1998, and Hudson Pacific announced their joint venture to take something old and make it new by revamping the mall into creative office space. With the deal Hudson Pacific is 75% owner and Macerich is 25% owner. Hudson Pacific will proceed as the day-to-day property operator and developer. Both parties will also own 96,000 square feet of entertainment and retail space on the property.
Architectural firm, Gensler is designing the new space. Plans will emphasize the use of natural lighting and open layouts for the office space - specifically high ceilings, a skylight and a multi-level atrium as well as 150,000 square foot open spaces on each floor. An indoor-outdoor experience will be created as well with about 45,000 square feet of outdoor terraces and patios surrounded by a 15-foot wide folding glass wall. The new space will utilize elements of the building that already exist such as the rooftop garden deck and the bridge that has direct access to the Westside Tavern restaurant, the Landmark Theater and other nearby retailers. Construction is set to begin later this year and is projected to cost upwards of $475 million.
Google signed a 14-year lease for an undisclosed amount. The new space, penned One Westside, plans to be completed and opened by the year 2022. Google is keeping its planned use for the office space under wraps for now.