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Office Sale Gives Offshore Trend Korean Flavor

One of the larger multitenant office complexes in Buena Park has traded hands in the latest notable Orange County commercial real estate deal involving investors from Asia.

Buena Park Commerce Plaza, a two-building complex on Beach Boulevard that’s just off the Santa Ana (I-5) Freeway, recently fetched about $29.1 million, according to CoStar Group Inc. records. The deal for the 159,000-square-foot property came to around $183 per square foot.

The offices were bought by a group of high-net-worth foreign buyers, according to Anthony DeLorenzo, first vice president for the Newport Beach office of CBRE Group Inc. who was part of the brokerage team that marketed the property for the seller, Dallas-based Lincoln Property Co.

The complex was marketed in large part to Korean and Chinese buyers; property records suggest that at least some of the buyers are from Korea or of Korean descent.

The deal appears to add to an already-sizable presence for the ethnic group in Buena Park, which combines with neighboring Fullerton for a concentration of Korean-American residents and businesses that’s second in Southern California only to Koreatown in Los Angeles.

About 11% of Buena Park’s population—roughly 9,000 people—is Korean-American, according to 2013 U.S. census data.

OC overall is home to about 90,000 Korean-Americans and 9,000 businesses owned by members of the ethnic group, according to Business Journal research.

The three-story buildings at Buena Park Commerce Plaza are on about 8.2 acres near the intersection of Beach Boulevard and Auto Center Drive.

The buildings were about 75% leased when they were listed for sale earlier this year.

They’re expected to offer the new owners “an opportunity to create potential upside value and tenant demand with the completion of some facility improvements,” including upgrades to a large courtyard at the complex, according to CBRE marketing materials.

The buyers got a $20 million loan from the Cerritos office of Hanmi Bank, a Korean-American institution, according to property records.

Foreign investors are continuing to target OC’s office and industrial market “big time,” said DeLorenzo, who worked on the Buena Park deal with colleagues Paul Jones, Gary Stache and Kevin Shannon.

Thomas Kim of GTR Consulting Group Inc. in Los Angeles represented the buyer.

DeLorenzo said that about a quarter of the properties his team has recently put on the market have been snapped up by offshore investors. Another 25% of deals are being bought by 1031 exchanges—which involve a swap of one business or investment asset for another—exchanges that include a large number of offshore investors.

Foreign buyers don’t appear to be afraid to pay big prices for local buildings.

A 15,705-square-foot warehouse in the Irvine Spectrum that’s leased to Level 3 Communications Inc. of Broomfield, Colo., was sold this month for a little more than $5 million, or about $320 per square foot.

It’s the priciest industrial sale in the Irvine Spectrum in five years on a per-square-foot basis, according to CoStar records.

The property was bought by a Taiwanese-based investor, according to DeLorenzo, who listed the warehouse along with CBRE’s Stache and Doug Mack.

The building is at 7 Mason, near the southern edge of the Great Park Neighborhoods development.

Telecom and Internet service provider Level 3 Communications has been a long-term tenant at the building and has about 10 years remaining on its lease, which made the property an attractive investment, DeLorenzo said.

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Mark Mueller
Mark Mueller
Mark is the Editor-in-Chief of the Orange County Business Journal, one of the premier regional business newspapers in the country. He’s the fifth person to hold the editor’s position in the paper’s long history. He oversees a staff of about 15 people. The OCBJ is considered a must-read for area business executives. The print edition of the paper is the primary source of local news for most of the Business Journal’s subscribers, which includes most of OC’s major corporate and community players. Mark’s been with the paper since 2005, and long served as the real estate reporter for the paper, breaking hundreds of commercial and residential real estate stories. He took on the editor’s position in 2018.
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