The debt behind one of Bunker Hill's best-known office towers just changed hands for well under half its face value. On Oct. 19, Newmark said it had completed the sale of the $290 million loan secured by Wells Fargo Center South, the 45-story tower at 355 S. Grand Ave. The reported price, about $115 million, puts a fresh number on how far Downtown Los Angeles office values have reset, and it adds another name to the short list of groups now positioned to decide what these towers become.
What happened
According to the Newmark announcement, the buyer is New Age 355, LLC, an affiliate of Kam Sang Company, Inc. A Newmark capital markets team led by Kevin Shannon represented an undisclosed seller. The tower has about 1.16 million square feet, was designed by Skidmore, Owings & Merrill and connects to the renovated HALO amenity center. Newmark said it was about 42% leased at the time of the sale, with government, legal, insurance and financial services tenants.
Newmark did not publish a price. The Real Deal reported that the loan traded for about $115 million, or roughly $100 per square foot, citing a person familiar with the deal, and identified the seller as a consortium of lenders. The tower was previously owned by Brookfield. CapDex, which also reported the $115 million figure, put the discount at about $175 million, or roughly 60%, and the implied basis near $99 per square foot. Newmark declined to comment to TRD, and neither Kam Sang nor Brookfield responded to its requests. Treat the price as reported, not confirmed by the parties.
A loan sale is not a building sale
Kam Sang's affiliate bought the debt, not the deed. The loan is secured by the fee simple interest in the tower, which means full ownership of the land and building. Owning the loan gives the buyer control through the debt, but as CapDex noted, it is not a completed sale of the property. The buyer could later take title through foreclosure, a restructuring with the borrower or another process.
This was a lender-facilitated sale, where lenders hire a broker to market a troubled loan rather than wait out a long workout. When the loan went on the market in December 2025, TRD reported that offers were expected around $157 million, or about $130 per square foot, and that the State of California was the largest tenant, at roughly 10% of the building. The final reported price landed about $42 million below that expectation.
What Kam Sang plans to do next is not yet known. The company has not said whether it intends to foreclose, negotiate with the borrower, keep the building as offices or pursue something else.
How far the price has fallen
TRD reported that the tower was worth about $450 million nine years ago. At 1.16 million square feet, that works out to roughly $390 per square foot, against about $100 today. The building itself, completed in 1983, has not changed nearly as much as the market around it.
Newmark framed the discount as an opening. "As pricing continues to adjust, buyers are gaining access to irreplaceable real estate at a compelling basis relative to replacement cost," Shannon said in the announcement. The other side of that math is occupancy. With roughly 58% of the tower not leased, a new owner has to fill a large amount of space, find an occupier for it or reposition the building, and each path costs money before it earns any.
The third big Bunker Hill reset this year
Newmark said this is the third ownership or loan sale of a Downtown Los Angeles office tower taller than 40 stories in 2026, and that two of the three involved buyers planning to occupy part of their buildings. The other two are close neighbors.
- Wells Fargo Center North Tower, 333 S. Grand Ave. New York-based 601W completed its purchase in June. TRD reported that about $506 million of debt on the tower was in default. Newmark's second-quarter 2026 market report put the price at about $180 million, or roughly $127 per square foot.
- Bank of America Plaza, 333 S. Hope St. Capital Group, a tenant since 1978, bought the 1.4 million-square-foot tower for $210 million in a receivership sale and plans to add five floors to its space.
TRD also reported that the debt on EY Plaza, the last of the four Brookfield-linked towers shopped late last year, is back on the market after earlier deals fell through. Newmark Research said owner-users made up 59% of Los Angeles office sales above $25 million through the third quarter, more than double their average share in 2024 and 2025.
The office market backdrop
Downtown's vacancy remains well above the regional average. Kidder Mathews' third-quarter 2026 office report put Downtown's direct vacancy at 23.3% and total vacancy at 24.4%, compared with 16.4% direct vacancy across Los Angeles. Other firms measure differently and report higher figures, so compare like with like when you cite a number. The common thread is that Downtown has far more empty office space than the rest of the region, and many owners who borrowed at older valuations have struggled to refinance, as the defaults at these three towers show.
What it could mean for housing
Lower office prices feed directly into the conversion conversation. The city's Citywide Adaptive Reuse Ordinance, effective Feb. 1, 2026, lets most commercial buildings at least 15 years old in eligible zones convert to housing through a streamlined, mostly by-right permit process. By age alone, a 1983 tower clears that threshold, though eligibility also depends on zoning and historic status, and no conversion has been proposed for Wells Fargo Center South.
Kam Sang does have recent experience with this kind of project. Earlier this year, the Arcadia-based developer filed an adaptive reuse application to turn a 351-room Hilton in Glendale into condos. That is a hotel in another city, not an office tower in Los Angeles, so it shows the company's interest in reuse, not its plans for Bunker Hill.
Not everyone expects conversions to move quickly. The Los Angeles Business Journal reported in April that developer and lender appetite for adaptive reuse is catching up slowly, held back by scarce equity, uncertain economics and the city's property transfer tax. A cheaper building helps the math, but it does not cover the cost of new plumbing, life-safety upgrades and unit layouts on its own.
What agents should take from it
- Separate office distress from home values. Clients who own or want a Downtown condo or loft may read headlines like this as a warning. Tower prices reflect office rents, vacancy and debt. Residential values depend on residential supply and demand, and this sale does not change either directly.
- Watch the daytime population. Owner-users matter to Downtown's restaurants, retail and walkability. Capital Group's plan to take more floors at Bank of America Plaza adds weekday workers to Bunker Hill, while a 42%-leased tower next door does the opposite.
- Track the next filing. If the new lender pursues foreclosure, recorded notices would show up in county records, and any later deed transfer would make the ownership change public. Until then, the borrower still holds title.
- Know the conversion rules in plain terms. Buyers asking whether empty towers will become apartments deserve a measured answer. The rules are now in place citywide, but each project still has to work financially and physically, and large conversions take years.
- Use the per-square-foot numbers carefully. Roughly $100 per square foot for a Class A tower is a striking figure, but it reflects a distressed loan on a partly empty building. It is not a comparable for homes, condos or smaller commercial properties.
The next clear signal will be what Kam Sang does with its position: a foreclosure, a negotiated handover or a public plan for the building. Each would say more about where Bunker Hill's office reset goes from here.