S
outhern California Gas Company (SoCalGas) has signed a long-term lease for nearly 200,000 square feet on eight floors at the 52-story tower previously known as Two California Plaza, now renamed as 2Cal, located at 350 South Grand Avenue in downtown Los Angeles. The lease agreement was made with Mid-Wilshire-based CIM Group, the building's owner, and is set to be completed by spring 2026. The terms of the agreement remain undisclosed.

    SoCalGas is relocating from its current troubled namesake tower at 555 West 5th Street, where it has been a primary tenant since the building's completion in 1992. The new corporate hub, expected to open after renovations are completed, will be approximately two-thirds the size of its current office space.

    Erica Berardi, a spokeswoman for SoCalGas, did not provide reasons for the company's decision to relocate but mentioned that their current lease is set to expire at the end of 2026. The new office space will include a ground-floor area dedicated for customer services.

    According to an analysis by Raise Commercial Real Estate, the lease at Two California Plaza is the largest in downtown Los Angeles this year. The building is part of a complex that includes offices, hotels, and retail spaces built during the 1980s as part of an urban renewal project aimed at transforming blighted neighborhoods like Bunker Hill into thriving residential areas.

    SoCalGas will join City National Bank as a tenant at 2Cal tower, where their signage will replace the bank's nameplate at the top of the building.

    In a separate transaction, Los Angeles County has agreed to purchase the Gas Company Tower at 5th Street and Grand Avenue for $215 million or $154 per square foot, significantly lower than its pre-pandemic assessed value of $630 million or $527 per square foot. The L.A. County Board of Supervisors must approve the purchase for the county to proceed with the acquisition.

    The offer came more than a year after Brookfield Properties, a New York-based company, defaulted on $450 million in loans tied to the 1.4 million-square-foot building. As interest rates increased and leasing ebbed, the payments associated with the loans became increasingly burdensome for Brookfield Properties.