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The West Coast's Incognito Home of the Internet Just Sold

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The One Wilshire tower Downtown just sold for a record-setting $437.5 million--at about $660 per square foot, it's the highest price ever paid for a Downtown office building and way more than twice the price paid recently for the much more high-profile US Bank Tower, according to the LA Times. Why on earth? Because One Wilshire, built in 1966, "is widely regarded in the industry as the single most important telecommunications hub in the Western U.S." and one of the top three communications properties in the entire world. While a few floors are still filled up with law firms and stockbrokers, most of the building is packed with servers and fiber-optic cables routing "[b]illions of phone calls, emails and Internet pages" every week (it's "the primary terminus for major fiber-optic cable routes between Asia and North America").

One Wilshire had fallen on hard times by the 1990s, but as the internet began to grow, communications firms began clustering at the building, mostly to be close to AT&T's "fortress-like switching center on Grand Avenue at Olive Street." Now there're about 300 service providers and other telecommers in the building, including AT&T, Verizon, Sirius XM, and China Telecom. In an alarmingly oblique remark, a rep for the seller says the NSA is "not a direct tenant" in the building (seriously, what is that supposed to mean??). In a story about One Wilshire a few years back, Wired noted that "If this facility went down, most of California and parts of the rest of the world would not be able to connect to the internet."

Rents run about $4 per square foot in the building (again, double those at the US Bank Tower) and, according to a real estate agent involved, they're probably going to go even higher. One Wilshire was purchased by a Menlo Park-based private equity investor called GI Partners.
· Downtown L.A. office building sells for record $437.5 million [LAT]