Griffin Capital Essential Asset REIT Nets 80% Return from DreamWorks Property Sale

Griffin Capital Essential Asset REIT Inc., a publicly registered non-traded real estate investment trust, has sold the DreamWorks Animation’s Headquarters and Studio Campus in Glendale, California for $290 million.

DreamWorks Animation is an animation studio responsible for movie franchises such as Shrek, Madagascar, How to Train Your Dragon, and Kung Fu Panda. The five-building, 460,000-square-foot property was originally acquired in July 2015 for $215 million.

“DreamWorks Animation’s Headquarters and Studio Campus was a great investment; we are pleased by the opportunity to sell the property at a price substantially higher than at purchase,” said Louis Sohn, Griffin Capital’s director of acquisitions. “The proceeds will allow us to make strategic acquisitions that provide higher yields to the REIT.”

Michael Escalante, chief investment officer of Griffin Capital, noted, “Comcast acquired DreamWorks Animation in August 2016, dramatically improving our tenant’s credit profile, resulting in nearly 150 basis points of yield compression relative to our purchase cap rate. We elected to realize this substantial value appreciation and generated an approximately 80 percent aggregate return on the REIT investors’ equity in just over two years.”

The company said that proceeds from the sale will be used to execute a series of 1031 exchanges.

Griffin Capital Essential Asset REIT oversees a portfolio of 74 office and industrial properties purchased for a total of $3.4 billion. The company’s initial public offering was declared effective by the U.S. Securities and Exchange Commission in November 2009. The REIT closed its follow-on offering in April 2014 after raising a total of approximately $1.5 billion in investor equity, according to Summit Investment Research.

Click here to visit The DI Wire directory page.