Onni Group is tripling down on the Los Angeles office market despite the rising vacancy rate.
The Canadian developer plans to add two high-rise office towers to Wilshire Courtyard, boosting the complex from 1 million square feet to 3 million, according to the Los Angeles Business Journal.
Onni filed its plans this summer to add a 35-story tower and a 41-story tower to the Miracle Mile property, the Journal reported. The two towers would have connector bridges and would include a retail portion.
Onni bought the property from Tishman Speyer in early 2019 for $630 million, and by mid-summer had signed WeWork to a 355,000-square-foot lease.
Earlier this year, the servicer on Onni’s $408 million CMBS loan on the property claimed it violated a loan agreement by signing WeWork without lender Natixis’ prior approval, prompting a default.
But Onni has big plans for the complex. It wants to demolish and renovate Wilshire Courtyard’s two existing buildings, as well as add around 60,000 square feet of outdoor space in terraces and other spaces.
Around 115,000 square feet of retail will also be added on the street level, including a grocery store, as well as 2,000 additional parking spaces across eight levels, according to the Journal.
A new report from CBRE found that overall vacancy in the L.A. office market climbed to 15 percent in the third quarter, from 13.7 percent in the second. Across the city, office leasing was as bad as it’s been since 2009, according to the Q3 report. [LABJ] — Dennis Lynch