The Ratkovich Company

The Ratkovich Company in the News

RATKOVICH RETURNS
Downtown Pioneer Buys 800 Wilshire for $30 Million
Los Angeles Downtown News - March 5, 2004
by Jason Mandell

The 800 Wilshire building, a 16-story office tower in the heart of the Financial District, was sold last Tuesday for roughly $30 million. The buyer is the Ratkovich Company, headed by pioneering developer Wayne Ratkovich, an active force in Downtown real estate more than two decades ago.

The firm that restored the Oviatt Building, Fine Arts Building and Wiltern Theater plans to spend $3 million upgrading 800 Wilshire. Photo by Gary Leonard.

The firm purchased the 213,500-square-foot structure at Wilshire Boulevard and Flower Street from a partnership between the Praedium Group and ScanlanKempBard Companies. Ratkovich said the company, which left Downtown in the 1980s after reviving some of the area's leading historic structures, will move its headquarters from the Mid-Wilshire area into 800 Wilshire by the end of May.

"We just think this is a particularly good opportunity," said Ratkovich. "It's a fine building, great location, and great physical value."

Clare De Briere, executive vice president of Ratkovich, also cited the building's parking garage and attendants as a key factor. "When we heard it was for sale, we figured it was the perfect way to get back in Downtown in a comfortable way," said De Briere.

The Ratkovich Company purchased the property in association with Prudential Real Estate Investors. Cushman & Wakefield represented the Praedium and ScanlanKempBard partnership.

De Briere said the company plans to spend more than $3 million improving the 1971 edifice, including a redesign of the lobby and public spaces. "It's a terrific building that could be made better," said De Briere. "We want to make it a really high design, high style, high service location so it's more than just a place where you office."

Occupancy in the building is over 80%; major tenants include Clark and Trevithick, Black & Veach Construction and architecture firm Johnson Fain, which has been tapped by Ratkovich to design the building's improvements.

Broker Irving Bonios, president of BE Commercial Real Estate who was not involved with the deal, said that Ratkovich's experience sprucing up premier properties suggests that his rehab of 800 Wilshire will be first class. "I would venture to say that if he's going to be in charge of remodeling that building, it should be stunning when it is completed," said Bonios.

The sale of 800 Wilshire comes on the heels of Milbank Real Estate's purchase of a nearby 24-story office tower at 660 Figueroa for $62 million. That structure sold for $225 per square foot, whereas 800 Wilshire fetched about $140 per square foot. De Briere noted that her company reached an agreement on the purchase price before 660 Figueroa had entered escrow.

Observers say both sales indicate a healthy Downtown commercial real estate market. "There is a lot of positive activity in the office leasing market," said Bonios, noting that as the area evolves into a residential hub, top quality office buildings will increase in value as well.

:: Coming Back for More

Wayne Ratkovich, who founded the Ratkovich Company in 1972, was once a major player in Downtown real estate. In 1978 Ratkovich purchased the Oviatt Building on Olive Street from the Archdiocese of Los Angeles for $450,000. After restoring the 1928 structure's Art Deco interior, he sold it a few years later for $14.6 million.

In 1983 Ratkovich partnered with businessman (and eventual mayor) Richard Riordan to buy another historic structure, the Fine Arts Building at 811 W. Seventh St., which they restored. Ratkovich later sold his share to Riordan. The two buildings are now considered jewels of the Business District.

"He was a visionary," said Stan Michota, who co-developed California Plaza while Ratkovich was working Downtown. "He faced terrific challenges."

Also in the early '80s, Ratkovich undertook a roughly $30 million renovation of the Wiltern Theatre, and the Pellissier tower atop the theater, at Wilshire and Western, west of Downtown. He reopened the theater and concert venue in 1985.

De Briere said that during the "overbuilding" of the 1980s, the firm left Downtown and "didn't look back." While the company was focused largely on its renovation of the Wiltern and Pellissier, it did occasionally take on Downtown projects, including the development of a campus for the Fashion Institute of Design & Merchandising at Olympic and Grand.

Ratkovich was also involved in a decade-long development effort at the Terminal Annex property next to Union Station. The land and the building were owned by the U.S. Postal Service, which in 1990 asked Ratkovich to help develop the property. H owever, during the entitlement process, the Postal Service decided instead to sell most of the property. Ratkovich said his firm helped sell the various pieces for a total of $50 million, twice its appraisal value.

Now, with new momentum in Downtown fueled by residential development, De Briere said the company decided to reinvest in the area.

"There's been too many good things that have been happening there to ignore," said De Briere. "We really think Downtown is going to be the next area for real growth and continued urbanization."

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