Orange County sports surging office rental rates and one of the lowest vacancy rates in the nation.
CB Richard Ellis Group Inc. reports that OC vacancy rates fell 37% to 6% in the first quarter, versus a year earlier. Rents are up nearly 12% to $2.29 per square foot.
Atlanta, meanwhile, has been one of the worst office markets in the U.S. during the past few years, with vacancy rates standing at about 18% at the end of 2005.
But Atlanta’s struggles haven’t deterred San Clemente-based Argus Realty Investors LP, which has spent close to $170 million buying a pair of trophy properties in Atlanta.
Argus Realty this month paid $103 million for Securities Centre, a two-building, 526,617-square-foot complex in Atlanta’s Buckhead area. That makes the deal worth about $196 per square foot, with a cap rate of 6.6%.
Four-year-old Argus Realty, led by Chairman and Chief Executive Richard Gee, was said to have outbid 15 buyers for the complex, previously owned by Olympia Properties LLC.
It’s the biggest deal yet for Argus Realty, a tenant-in-common company that moved its offices from San Juan Capistrano last October.
Argus Realty has about 28 properties in its national portfolio. It primarily has office space,a total of 7.7 million square feet.
The company owns one property in OC, the Von Karman Business Park. It’s a 100,462-square-foot complex in Irvine, which Argus Realty bought in 2004 for $14.8 million.
Securities Centre was the second big Atlanta office acquisition Argus Realty made in the past six months. It also paid about $67 million for a 393,000-square-foot building last year.
While the overall Atlanta market has been lagging, the Buckhead submarket has been much stronger, Argus Realty officials said.
Other high-end Buckhead buildings are trading higher, at close to $260 per square foot.
The two buildings it bought are almost fully occupied,one building is 98% leased, the other is 95% full. And the Securities Centre site also includes land worth about $5 million.
Talega Center Back On
Residential construction is winding down in San Clemente’s Talega masterplanned development. But other types of projects, particularly retail, still are moving ahead in the areas around one of South County’s largest build-outs in recent years.
Irvine-based Hopkins Real Estate Group this month got the OK from the city’s planning commission for a 103,000-square-foot shopping center. It will be near the entrance of the Talega Golf Club that’s the centerpiece of the 3,500-acre housing development.
The next stop is the City Council, where final approval for Talega Village Center is expected next month, said Brian Hopkins, director of development for the company.
A 46,000-square-foot Ralphs Fresh Fare grocery store is set to anchor the center, which is due to break ground this summer. Tenants are set to open in the first quarter of 2007. Other tenants will include restaurants and specialty retailers.
The project has been in the planning stages for a few years. It originally was drawn up as a 130,000-square-foot center. The design was scaled back when a second floor of shops was rethought, Hopkins said.
Hopkins Real Estate is developing the project in a partnership with longtime financial partner Rockwood Capital of San Francisco. The developer bought 10 acres for the project in February 2004 for nearly $7 million.
Irvine-based KKE Architects is designing the center, and the Irvine office of Lee & Associates Commercial Real Estate Services Inc. is handling leasing on the project.
The shopping center is the second big San Clemente retail project along Avenida Vista
Hermosa that is progressing.
Along the San Diego (I-5) Freeway, grading work has begun for Irvine-based SunCal Co.’s Marblehead Coastal, a pricey housing project. The site also will include a retail complex, Plaza San Clemente, which is being developed by Newport Beach’s Craig Realty Group and SDC Partners Ltd.
Freezer Maker Cools on OC
Anaheim-based Commercial Cooling Par Engineering Inc., one of the country’s largest makers of walk-in coolers and freezers, is tripling its size. But the expansion won’t be happening in OC.
Commercial Cooling, founded in 1967, recently paid $6.4 million for a 60,000-square-foot plant in Industry, where it plans to move its headquarters.
The company’s building in Industry is on about 3.5 acres of land and triples the company’s plant capacity. About 40 people will be employed at the site, set to open mid-June.
Jason Jamison of Whittier-based GM Properties represented the manufacturer in the deal. Dan de la Paz, Walt Chenoweth and Frank Geraci of CB Richard Ellis’ Ontario office represented the seller, Arenth Avenue Associates.
