Los Angeles, September 4, 2025
News Summary
One California Plaza, a 42-story skyscraper in downtown Los Angeles, has entered receivership following a drastic 74% decline in its market value. Once valued at $459 million in 2013, its current appraisal stands at $121.2 million. The decline stems from the owners defaulting on a $300 million debt and losing major tenants, including a prestigious law firm. The situation reflects broader trends in the office market driven by the COVID-19 pandemic and rising interest rates, leading to discussions about converting vacant office spaces into housing units.
California – One California Plaza, a prominent 42-story skyscraper in downtown Los Angeles, has officially entered receivership due to a significant decline in the office property market. The property, once valued at $459 million in 2013, is now appraised at $121.2 million, marking a staggering 74% decline from its peak value.
The receivership situation arose after the building’s owners defaulted on a $300 million debt due to mature in November. In response, a judge appointed Trigild, a specialized receivership service, to take control of the property following a formal request from the lenders. This move indicates the financial distress faced by the property owners.
Recent evaluations revealed that net cash flow for One California Plaza fell short of operational expectations by 37% last year. Currently, the office space is only 62% leased after losing several major tenants. Notably, the prestigious law firm Skadden, Arps, Slate, Meagher & Flom has vacated the building, further emphasizing the downturn in occupancy rates.
The ownership group, comprised of Rising Realty Partners and DigitalBridge, has not issued any comments regarding the receivership situation, leaving many questions unanswered about future plans for the skyscraper.
Market Context
This decline in the office market can be largely attributed to shifts caused by the COVID-19 pandemic. The increase in remote work has led many companies to reduce their office space needs, contributing to a broader negative trend across the downtown Los Angeles area. Concurrently, soaring interest rates have pressured property prices, complicating the refinancing processes for building owners and pushing some properties into precarious financial territory.
Analyses of the downtown area show that around 54 office buildings are also facing immediate risks of devaluation, potentially leading to a staggering $70 billion loss over the next decade. This expected decline in property values could additionally result in a loss of approximately $353 million in property tax revenues for the city.
Future Considerations
Several nearby buildings, including the Gas Company Tower, have similarly seen substantial drops in value in recent years, raising concerns about the overall perception of downtown Los Angeles, especially with upcoming significant events such as the World Cup and Summer Olympics.
Meanwhile, Oceanwide Plaza—a significant development nearby—remains stalled in bankruptcy, now dealing with ongoing challenges linked to high-interest rates and soaring construction costs that inhibit its sale.
Conclusion
The situation at One California Plaza reflects broader trends in the commercial real estate market, driven by both changing workplace culture and economic factors. As this narrative unfolds, the decisions made in response to these developments will likely shape the future of downtown Los Angeles.
FAQ
What is the current status of One California Plaza?
One California Plaza has entered receivership due to a significant decline in its market value and a default on a major debt.
How much has the property value decreased since its peak?
The building’s value has decreased by 74% from its peak value of $459 million to $121.2 million.
Who controls the property now?
Trigild has been appointed as the receiver to manage the property following a judge’s ruling at the request of the lenders.
What factors contributed to this decline in the office market?
Remotely working trends due to the COVID-19 pandemic and rising interest rates have been significant contributing factors to the decline.
Are there plans to convert office buildings into housing?
Yes, stakeholders are advocating for conversion of vacant offices into housing to address the local housing shortage and increase property values.
Key Features Overview
| Feature | Data |
|---|---|
| Building Name | One California Plaza |
| Building Height | 42 Stories |
| Peak Market Value | $459 Million |
| Current Appraised Value | $121.2 Million |
| Debt Amount | $300 Million |
| Leasing Rate | 62% |
Deeper Dive: News & Info About This Topic
- Los Angeles Times: Sale of Graffiti-Tarnished Towers in Downtown Los Angeles
- Wikipedia: Downtown Los Angeles
- KTLA: Downtown Los Angeles Skyscraper Loses 2/3 of Value
- Google Search: Los Angeles Commercial Real Estate Market
- AOL: Los Angeles County Bought Skyscraper
- Encyclopedia Britannica: Commercial Real Estate
- Daily News: LA County Skyscraper Retrofit Surprises Supervisors
- Google News: Skyscrapers Los Angeles
Author: STAFF HERE HOLLYWOOD
The Hollywood Staff Writer represents the experienced team at HEREHollywood.com, your go-to source for actionable local news and information in Hollywood, Los Angeles County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Hollywood Bowl summer concerts, the Hollywood Christmas Parade, film premieres at TCL Chinese Theatre, and festivals at the Magic Castle. Our coverage extends to key organizations like the Hollywood Chamber of Commerce and Visit Hollywood, plus leading businesses in entertainment, dining, and tourism that define the local economy. As part of the broader HERE network, including HERELosAngeles.com, HEREBeverlyHills.com, HEREAnaheim.com, and HEREHuntingtonBeach.com, we provide comprehensive, credible insights into Southern California's dynamic landscape.
