The California State Compensation Insurance Fund just picked up the office tower at 35 N. Lake Ave in Pasadena for roughly $33 million, a price that is about $25 million below what the property fetched in 2019. It is a blunt reminder of how far suburban office values have slid as employers shrink their footprints and buyers insist on deep discounts.
According to L.A. Business First, reporter Isabel Sami notes that State Compensation Insurance Fund, the state-run workers' compensation insurer, is the buyer behind the roughly $33 million deal for 35 N. Lake Ave, and that the price is about $25 million under what investors paid in 2019.
Public records show the building last traded in October 2019 for about $58.2 million, per Homes.com. That earlier sale came as part of a three-building Pasadena office portfolio arranged by JLL and financed with a loan from Nuveen, according to Commercial Observer.
Why The Discount Matters For The Market
The broader numbers help explain why this kind of markdown is becoming more common. Market data from CBRE show Los Angeles-area office vacancy at about 25.5% in the first quarter of 2026, with availability around 30.5%. With that much empty space sloshing around, investors are baking in longer lease-up periods and higher risk, which in turn drives pricing down.
Institutional owners have already taken their lumps elsewhere in Southern California. Commercial Observer reported in January 2025 that New York Life unloaded an Irvine office building at roughly a 55% haircut compared with what it paid in 2015. Deals like that have made buyers both wary and opportunistic, waiting for distress and then pouncing when the numbers finally pencil out.
The buyer in Pasadena, State Compensation Insurance Fund, describes itself on its website as California's largest workers' compensation carrier and a not-for-profit public enterprise focused on workplace safety and claims management, per State Fund. As the Los Angeles Times has reported, some buyers are now stepping in as long-term holders or owner-users when office values fall, aiming to lock in lower costs and ride out the downturn.
For Pasadena, the sale drops a new institutional owner onto the Lake Avenue corridor. Local brokers will be watching leasing moves and any amenity upgrades at 35 N. Lake Ave for clues about what comes next. For now, the transaction stands as one more data point in a regional office market that still looks like it is searching for a bottom.
