In another blow to the struggling downtown office rental market, longtime stalwart corporate tenant PricewaterhouseCoopers has agreed to move its Los Angeles offices to Century City.
London-based PwC is one of the world’s largest accounting and professional services firms, perhaps best known publicly as the official tabulator of votes for Hollywood’s annual Academy Awards.
Its logo is widely visible atop a 52-story skyscraper on Figueroa Street in downtown’s financial district, but PwC’s lease there expires in 2028 and the firm has agreed to move that year to a premier building in Century City.
The company has been a presence downtown since the late 1990s and leased its current office space on Figueroa Street in 2013.
Employees were notified Monday of the pending transition to 2121 Avenue of the Stars. The red-granite and glass building overlooking Fox Studio Lot was formerly called Fox Plaza, but may be better known to movie fans as fictional Nakatomi Plaza, where Bruce Willis fought terrorists in “Die Hard.” Ronald Reagan kept offices in the 34-story tower after his presidency.
“This move is about growth, connectivity, and the future of our Los Angeles business,” Office Managing Partner Andy Sofield said in a statement to The Times. “PwC has continued to grow in the market, and the new Century City office gives us additional space in a location that better supports our people, clients, and teams across the region.
“Century City offers strong access to clients, our people, transportation corridors, and airport access,” Sofield said. “It is also a return to a neighborhood where PwC previously had an office more than two decades ago. We evaluated multiple options and determined Century City was the right fit for our future.”
PwC did not disclose details of the Century City lease, but a person with knowledge of deal who is not authorized to speak publicly said the services firm signed a 15-year lease valued at about $200 million to occupy 150,000 square feet. The firm’s downtown office at 601 S. Figueroa St. is smaller at 114,000 square feet, according to real estate data provider CoStar.
“Our business has grown, our number of people has grown, and this move gives us the opportunity to create a workplace that supports our teams, our clients and the continued evolution of our business in the region,” he said.
The company declined to elaborate on its reasons for leaving downtown, but the move marks the latest high-profile exit from the city’s financial core.
Many large companies already have shrunk their offices or given up on downtown, including Deloitte and KPMG. Financial services firm Wedbush Securities moved from a prominent financial district office tower to Pasadena.
The move also reflects the changed nature of downtown’s financial district since the COVID-related shutdown. Thousands of office workers departed, and they probably won’t return again in pre-pandemic numbers. Many shops and restaurants remain closed and office tenants have said the streets feel less safe than they used to.
Downtown has suffered from an oversupply of office space since a building spree in the 1980s and early 1990s. The lack of rent-paying tenants that has driven down office values has become more acute since the pandemic began. Nearly 40% of the office space in the financial district was available at the end of last year, according to CBRE. Overall vacancy downtown has climbed from 14% in 2019 to 34%.
“We’re sorry to see PwC leave and believe LA city officials need to do more to retain major office tenants in downtown, the economic center of the region,” Nick Griffin, executive vice president of the DTLA Alliance business improvement district, said in a statement.
A single departure doesn’t outweigh downtown’s momentum, which includes a growing residential population and nightlife, entertainment and tourism, he said. “The historic arc of Downtown L.A. is one of transformation and opportunity.”
Meanwhile, Century City has emerged as one of the region’s most sought-after office markets in recent years, said real estate broker Gary Weiss of LA Realty Partners. Offices there are more than 90% leased at rents that are the highest in the city, he said.
“When you look at how many companies have moved within the last three to four years from downtown to Century City, I’m not surprised” by PwC’s decision, Weiss said. The neighborhood next to Beverly Hills with offices, housing and a major shopping center “has great amenities in a very safe environment.”
PcW’s new landlord in Century City is Irvine Co. “We are proud to deepen our relationship with PwC as they establish their new presence at 2121 Avenue of the Stars,” said Roger DeWames, president of Irvine Co. Office Properties.
