Irvine Co. Purchases San Diego Office Park
In its first major commercial building purchase outside of its Orange County holdings, the Irvine Co. on Tuesday bought a high-tech business park in San Diego for about $26 million in cash, according to brokers.
The purchase is seen as part of the Irvine Co.’s plan to take its portfolio of office towers and industrial buildings public by forming a real estate investment trust (REIT).
The company is scouting for prime industrial and office properties throughout the state, specialists said, because real estate portfolios that include geographically diverse properties will be more appealing to Wall Street investors.
“The Irvine Co. wants to show they have an ability to make acquisitions and grow their company outside of the ranch,” said Craig Leupold), an analyst with Green Street Advisors in Newport Beach. “They might think the public markets will value this acquisition and the cash flow from it.”
All commercial properties of Irvine Co., the county’s largest landowner, are in Orange County, including the Irvine Spectrum, a business park made up of 2,200 companies and 36,000 workers.
On Tuesday, the Irvine Co. purchased the Canyon Ridge business park in San Diego from WCB Properties, a Newport Beach limited partnership that includes Goldman Sachs’ real estate arm, the Whitehall Investment fund.
Irvine Co. spokesman Larry Thomas could not be reached for comment.
The five buildings that make up Canyon Ridge, which has nearly 300,000 square feet, are 100% leased to such tenants as Cray Research, a computer company, and Medtronic Interventional Vascular, a division of a Minneapolis medical company.
Daniel J. Zinke, a senior vice president with the investment properties group of CB Commercial in Anaheim, represented the Irvine Co. on the deal.
“The Irvine Co. is very selective. They are looking in areas they feel are high-quality areas with a significant presence of high-tech firms, kind of like the Irvine Spectrum,” Zinke said.
He added that the purchase fits in with the company’s plans for a public offering.
“It does have to do with their REIT strategy--bigger is better for the REIT. It gives more stability to the stock price,” Zinke said. “And geographic diversity is another benefit.”
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New Territory
High-tech park, with five buildings and 300,000 square feet, is 100% leased.
