The latest big-ticket office sale in Beverly Hills — the ritzy retail corridor in greater Los Angeles — shows that athletic retailer Alo is on a shopping spree of its own.
The brand, the maker of matching workout sets that have built a cult-like following, this week dropped $82 million for the Beverly Hills Gateway building along famed Wilshire Boulevard, according to people with knowledge of the deal. The more than 131,000-square-foot property is located a few blocks from another building the company acquired last month, which was also one of the priciest office sales to close in the Los Angeles area this year.
The price tag for Alo's latest Beverly Hills deal underscores the brand's willingness to pay top dollar to scoop up properties aimed at bolstering its corporate presence and future growth. It recently shelled out $90 million, or $1,085 per square foot, for the nearly 82,900-square-foot La Peer Building along Wilshire Boulevard to house a larger corporate headquarters.
It's unclear what Alo plans to do with its latest office purchase. The deal comes as a spectrum of buyers — including owner-users such as Alo, as well as institutional powerhouses — are stepping up their investments in and outside of Beverly Hills.
Office investment sales nationally surged nearly 60% in the 12-month period as of October when compared to the same period last year, CoStar data shows. Private buyers and owner-users "have made up the lion's share of acquisitions" since 2023, according to CoStar's latest report, though institutional buyers are increasingly making their presence known.
Elsewhere in Los Angeles, Riot Games purchased its longtime headquarters from landlord Hudson Pacific Properties for $150 million earlier this month. Outside of Los Angeles, Apple snapped up a pair of Silicon Valley office buildings near its global headquarters for $216 million.
Alo did not immediately respond to CoStar News' requests for comment.
Beverly Hills boom
The sale is another pricey anchor for the Beverly Hills office market, which has emerged as a rare source of momentum for an otherwise stagnant Los Angeles region.
Beverly Hills "continues to see accelerated investment momentum, far outpacing other submarkets in Greater Los Angeles," Mike Condon, one of the Cushman & Wakefield brokers who helped represent seller 3D Investments in the Gateway deal, said in a LinkedIn post.
Investors have collectively spent upward of $500 million on office purchases in the Beverly Hills area over the past year, according to CoStar data, already significantly more than the $350 million that closed over the prior 12-month period.
Kilroy Realty, for example, spent $205 million to acquire the 290,000-square-foot building at 345 N. Maple Drive, marking one of the priciest Los Angeles area deals of the year and the real estate investment trust's return to the capital markets after a pandemic-era retreat. And online retailer Fashion Nova paid $118 million, or more than $675 per square foot, last year for a nearby office property that also serves as its headquarters.
Alo's ramped-up acquisition streak echoes the company's own trajectory over the past couple of decades.
The Los Angeles-born company, founded in 2007, has evolved from a yoga apparel startup into a global lifestyle brand with thousands of stores around the world and a booming digital wellness platform. Its rise has coincided with a surge in U.S. athleisure sales, which Dimension Market Research estimates will grow from the more than $154.5 billion reported last year to nearly $339 billion by 2033.
The company was last estimated to have a value of about $10 billion in late 2023, according to Reuters, with 2022 sales exceeding $1 billion, or triple compared to the previous year.
CoStar's Brannon Boswell contributed to this report.