Three office buildings in Mission Viejo and Newport Beach have sold in two transactions that, combined, industry observers valued at more than $90 million as investor demand for Orange County commercial properties heats up.
The sales to large national investors are a sign that the county's office market is recovering from the drubbing it took after the mortgage industry began to contract in 2007, said real estate broker Ryan Gallagher of HFF.
Before that, lenders such as
"In the last real estate cycle we had the perfect storm of the subprime meltdown, a lot of new construction coming online and then the national recession," Ryan said. "This time we have a very balanced recovery from a tenant perspective."
Growing industries in Orange County include financial services, technology, biotechnology and healthcare, he said. The mortgage industry has found its footing but is no longer the main driver of the office market.
The recently sold properties are in Mission Viejo and Newport Beach, according to HFF, which helped arrange both sales.
Mission Ridge, a two-building office complex in Mission Viejo completed in 2000, was sold by Prudential Real Estate Investors. The buyer was Cornerstone Real Estate Advisers, a
Offices in the four-story, 231,000-square-foot Mission Ridge complex near the 5 Freeway are leased to such tenants as computer security company McAfee, Pulte Homes,
The other sale was of Newport Plaza, an office building at 895 Dove St. just south of John Wayne Airport. The 104,500-square-foot building, also completed in 2000, is the headquarters of law firm Newmeyer & Dillon.
A fund managed by investment firm
Terms of the sales were not disclosed, but experts familiar with the Orange County market valued the Mission Ridge deal in the mid-$50-million range and the Newport Plaza sale at close to $40 million.
Office vacancy in the John Wayne Airport area was 15% at the end of the second quarter, down from 17% from the middle of 2012, according to Cushman & Wakefield. Average rents rose slightly.