Korean asset firm underwrites $61.5 mn mezzanine loan of LA office building

A South Korean handbag maker’s fund management unit has invested $61.5 million in mezzanine debt of a prime office building in Los Angeles, jointly with South Korean pension funds on Dec. 6, targeting an annual return of about 5%.

The mezzanine investment led by Simone Asset Management represents about two thirds of the $93.5 million mezzanine tranche of the fund for the acquisition of The Bluffs at Playa Vista, according to investment banking sources on Dec. 7. JPMorgan sold the building, valued at $500 million, to an unidentified buyer.

Morgan Stanley’s investment banking arm underwrote $220 million senior loans of the fund.

The Bluffs at Playa Vista, built in 2009, consists of two five-story office buildings with a lease space of 45,000 square meters, and is located in Playa Vista in LA. The neighborhood has been emerging as a technology hub as Facebook, Microsoft and YouTube opened offices in the area.

Simone Asset, wholly owned by handbag and accessory manufacturer Simone Holdings, had acquired De Rotterdam, a landmark building in Rotterdam, the Netherlands, from Rabo Real Estate Group in June.

By Daehun Kim

daepun@hankyung.com