NEW YORK – A Los Angeles office building located near Century City and Beverly Hills has sold for about 52 per cent less than its price five years ago.

Harbor Associates and F&F Capital Group bought the five-storey property at 1640 Sepulveda Boulevard for about US$44.7 million (S$59.2 million), according to a statement on Dec 26. The building last sold in 2018 for US$92.5 million.

It is the latest sale of a Los Angeles office building in a market that has been pressured by the rise of remote work and financing challenges brought about by soaring interest rates.

Recently, the Aon Center in downtown Los Angeles sold for US$147.8 million, about 45 per cent less than its previous purchase price in 2014.

The building at 1640 Sepulveda Boulevard was constructed in 1987 and has had more than US$11 million in renovations, including upgrades to tenant spaces as well as a redesigned lobby.

It was 80 per cent occupied at the time of the deal’s closing, according to the statement.

“After several years of kicking the can down the road, we are now beginning to see distress hit the market,” said Mr Joon Choi, principal at Harbor. “There are still compelling opportunities to find the hidden gems at a deep discount to replacement.”

The deal is the second real estate acquisition for the joint venture in the past two months. Harbor and F&F acquired an industrial portfolio in Carlsbad, California, for about US$21 million in November. BLOOMBERG