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os Angeles County is moving forward with its plan to buy the Gas Company Tower for $200 million, a significant deal in the Downtown market. The county's Board of Supervisors will consider approval of a notice stating its intent to purchase the building at next week's meeting. This follows several closed-door negotiations and would include the 1.4 million square-foot tower at 555 West Fifth Street, as well as the World Trade Center parking garage with over 1,200 spaces.

    The high-rise was placed in receivership last April after Brookfield Asset Management defaulted on debt tied to the building due to rising interest rates and a slowdown in leasing activity. KeyBank National Association has since taken over as special servicer. The building's value has dropped significantly, from $214.5 million in an appraisal this year to over 60% less than its 2021 valuation.

    The Gas Company Tower is currently 57% leased, with Southern California Gas Company set to move to a new location nearby. Downtown's office market faces challenges, including a second-quarter vacancy rate of 31.5%, according to CBRE. The Bunker Hill neighborhood where the tower is located has a slightly lower vacancy rate and average asking rents of $4.02 per square foot in the second quarter.