Prestigious Bunker Hill Tower Falls Victim to Post-Pandemic Office Struggles
In a stark illustration of downtown Los Angeles’s ongoing commercial real estate crisis, One California Plaza—the gleaming 42-story tower that once stood as one of the city’s most prestigious business addresses—has been placed into receivership following a catastrophic decline in value and mounting financial distress.
The receivership order, granted by a judge in late August 2025, represents another significant blow to downtown LA’s struggling office market, where vacancy rates have soared to approximately 33% and property values have plummeted in the wake of the pandemic-driven shift to remote work.
Dramatic Fall from Grace
One California Plaza’s story is one of precipitous decline. The tower, which opened in the 1980s as one of the most prestigious addresses in the city, has dropped 74% in value from its market peak. The property’s value plunged from its 2017 purchase price to just $121 million by 2024—a devastating 75% decrease.
The 1-million-square-foot property’s troubles became insurmountable when the owners defaulted on their $300-million debt, set to mature in November. Occupancy declined dramatically to about 63 percent this year compared to 88 percent at underwriting, while income fell precipitously to $9 million in June 2024 from $17 million in December 2023.
Receivership Process
At the request of lenders, a judge appointed Trigild, a receivership service, to take control of the 1-million-square-foot property. The receivership represents a legal mechanism that allows lenders to take operational control of a distressed property when owners can no longer meet their financial obligations.
Rising and partner DigitalBridge joined Brookfield on the list of landlords with properties in receivership last week, when a judge made the call on the 1 million-square-foot, 42-story One California Plaza on Bunker Hill.
Part of the Broader Downtown Crisis
One California Plaza’s receivership is not an isolated incident but rather symptomatic of a broader crisis affecting downtown Los Angeles’s commercial real estate sector. Downtown L.A.’s office sector is muddling along around a 33 percent vacancy rate, with powerhouses such as Brookfield handing keys back to lenders on multiple Class A offices over the past year.
The scope of the crisis extends far beyond individual buildings. A recent report by BAE Urban Economics found that 54 downtown L.A. office buildings are at immediate risk of devaluation, potentially resulting in nearly $70 billion in lost value over the next decade.
The irony of One California Plaza’s current predicament is particularly acute given its historical significance. The tower represented the pinnacle of 1980s commercial development in downtown Los Angeles, part of the Bunker Hill redevelopment project that transformed the area from a collection of Victorian-era buildings into a modern financial district.
As downtown LA grapples with this crisis, various stakeholders are exploring potential solutions. The BAE Urban Economics report suggested converting some offices to housing to mitigate an expected $353 million in losses, highlighting adaptive reuse as one potential path forward.
Office-to-residential conversions have gained traction in other markets facing similar challenges, though such transformations require significant investment and regulatory approvals. The feasibility of converting One California Plaza specifically would depend on factors including the building’s structure, zoning regulations, and market demand for downtown residential units.
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