A prominent tower in downtown Los Angeles has sold out of foreclosure one year after the owner defaulted on the building's loan, underscoring the distress still weighing on one of the nation’s largest office markets.
The 601West Cos., a New York City investment firm, has acquired the 1.4 million‑square‑foot Bank of America Plaza out of receivership for an undisclosed price, according to people familiar with the deal.
The property was previously owned by Brookfield Properties, one of the world’s biggest real estate firms. The building transferred to special servicing in mid-2024 as its $400 million loan matured.
Downtown Los Angeles’ office market is facing its toughest stretch in decades, marked by stagnant demand, high vacancies and declining rents as landlords rely on heavy concessions to fill space. Yet even amid steeply discounted sales and persistent uncertainty, rising transaction volume and a handful of stronger deals hint at early signs of renewed investor confidence, according to CoStar research.
601West has been snapping up high-profile office towers at discounts over the past year, including the 16-story 525 Van Buren St. in Chicago and the 22-story 205 E. 42nd St. in New York City in November. The company owns 43 properties, including 28 office buildings, according to CoStar data.
The deal contributes to a 25% year-over-year increase in office sales across greater Los Angeles.
Downtown office distress
The 55-story building is now 51% vacant, with tenants including The Capital Group Cos., Bank of America and Allied Insurance Services.
The building's loan defaulted at maturity in September 2024, and the special servicing assignment moved to Mount Street in November 2024.
In April 2025, Mount Street formally initiated the foreclosure process. A receiver was appointed the next month and marketed the property and the loan for sale.
In early 2023, Brookfield’s Downtown LA Office Fund defaulted on more than $1.1 billion in loans tied to the Gas Company Tower and the 777 Tower. Both skyscrapers entered receivership that year after Brookfield chose not to continue covering debt service.
Those properties have been sold to new owners. In June, Brookfield sold the 52-story Figueroa at Wilshire tower to Uncommon Developers for $210 million, or about $201 per square foot, in one of LA’s biggest deals of 2025. In March, 777 Tower sold to Consus Asset Management for about $145 million, less than half of the property’s $319 million outstanding debt, underscoring the depth of the office value reset.
Despite those sales, Brookfield remains a major downtown owner, with roughly 785 multifamily units and about 5.7 million square feet of office space in the market, some of which is also up for sale.
Brookfield is also marketing for sale FIGat7th, a 330,000-square-foot retail center at 735 S. Figueroa St. The property is anchored by Nordstrom Rack, Sephora, Target and Zara and carries a $59 million loan from MetLife that comes due this year.