Investment in Real Estate

12 Months Ended

Dec. 31, 2020

The following table summarizes the Company’s investment in real estate, at cost as of:


	December 31, 2020		December 31, 2019
Land	$	1,351,888	$	1,313,412
Building and improvements	5,840,819		5,189,342
Tenant improvements	728,111		631,459
Furniture and fixtures	12,250		10,693
Property under development	281,949		124,222
INVESTMENT IN REAL ESTATE, AT COST	$	8,215,017	$	7,269,128

Acquisitions

On December 18, 2020, the Company purchased, pursuant to a joint venture agreement with a subsidiary of CPPIB, the 668,109 square-foot 1918 Eighth office property located in Seattle, Washington. The purchase price before certain credits, prorations and closing costs was $625 million. The Company owns 55% of the ownership interest in this consolidated joint venture. The acquisition did not meet the definition of a business and was therefore accounted for as an asset acquisition. For asset acquisitions, the purchase price includes capitalized acquisition costs.

The following table represents the Company’s final purchase price accounting for the 1918 Eighth acquisition:



TOTAL CONSIDERATION	$	593,945

Allocation of consideration
Investment in real estate	$	584,250
Deferred leasing costs and in-place lease intangibles(1)	37,563
Above-market leases(2)	335
Below-market leases(3)	(28,203)
TOTAL	$	593,945

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1.Represents weighted-average amortization period of 9.1 years (before any renewal or extension options).

2.Represents weighted-average amortization period of 7.8 years (before any renewal or extension options).

3.Represents weighted-average amortization period of 9.3 years (before any renewal or extension options).

The Company did not complete any acquisitions related to consolidated entities during the year ended December 31, 2019.

Unconsolidated Joint Ventures

As of December 24, 2020, the Company owns 50% of the ownership interests in the joint venture which owns the Sunset LA development in Los Angeles, California. The Company serves as the operating member.

On June 5, 2019, the Company purchased, pursuant to a co-ownership agreement with Blackstone 1 LP, an affiliate of Blackstone, 20% of the ownership interest in the Bentall Centre office property and retail complex in Vancouver, Canada.

Refer to Note 4 for details.

Studio Joint Venture

On July 30, 2020, funds affiliated with Blackstone acquired a 49% interest in the Hollywood Media Portfolio, a 2.2 million-square-foot collection of studio and office properties with a gross portfolio valuation of $1.65 billion before closing credits, prorations and costs, resulting in cash proceeds to the Company of $808.5 million. The transaction included Sunset Gower, Sunset Bronson and Sunset Las Palmas Studios, as well as 6040 Sunset, ICON, CUE, EPIC and Harlow, along with 1.1 million square feet of development rights associated with Sunset Gower and Sunset Las Palmas Studios. The Company retained a 51% ownership stake in the Hollywood Media Portfolio.

Impairment of Long-Lived Assets

During the year ended December 31, 2019, the Company recorded $52.2 million of impairment charges related to the Campus Center office property that was held for sale at March 31, 2019 and was subsequently sold. The Company’s estimated fair value was based on the sale price (Level 2 input). The Company did not recognize impairment charges during the years ended December 31, 2020 and 2018.

Dispositions

The Company did not complete any dispositions related to consolidated entities during the year ended December 31, 2020. The following table summarizes information on dispositions completed during the years ended December 31, 2019 and 2018:


Property	Segment	Date of Disposition	Square Feet	Sales Price(1) (in millions)
Campus Center Office	Office	7/24/2019	471,580	$	70.3
Campus Center Land	Office	7/30/2019	946,350	78.1
TOTAL DISPOSITIONS IN 2019			1,417,930	$	148.4

Embarcadero Place	Office	1/25/2018	197,402	$	136.0
2600 Campus Drive (building 6 of Peninsula Office Park)	Office	1/31/2018	63,050	22.5
2180 Sand Hill	Office	3/1/2018	45,613	82.5
9300 Wilshire	Office	4/10/2018	61,422	13.8
Peninsula Office Park	Office	7/27/2018	447,739	210.0
TOTAL DISPOSITIONS IN 2018			815,226	$	464.8

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1.Represents gross sales price before certain credits, prorations and closing costs.

These properties were considered non-strategic to the Company’s portfolio. The disposition of these properties resulted in gains of $47.1 million and $43.3 million for the years ended December 31, 2019 and 2018, respectively. These amounts are included in the gains on sale of real estate line item in the Consolidated Statements of Operations.

Held for Sale

As of December 31, 2020 and 2019, the Company had no properties that met the criteria to be classified as held for sale.