CBRE Investment Management has acquired a four-building medical office portfolio totaling 282,683 square feet in Mission Viejo through a joint venture with Healthcare Realty Trust.
The assets, just off Crown Valley Parkway and next to Providence Mission Hospital, were part of the Healthcare Trust of America portfolio, which has merged with Healthcare Realty Trust to form the largest medical office building owner in the United States.
The deal is one of the largest in Orange County this year. The collection of buildings traded for about $134.8 million, according to data from real estate tracker CoStar Group Inc.
The portfolio includes Mission Medical Center Buildings 1-3 and the Mission Medical Center Tower. The latter is the largest of the assets, a five-story building running about 120,000 square feet
“Medical office is a new strategy for our fund,” CBRE portfolio manager Larissa Belova said in a statement.
“Our strategy focuses on assets located within or adjacent to thriving hospital systems that create ecosystems that benefit doctors and their patients,” she said.
CBRE Investment Management, which has $146.9 billion in assets under management as of June 30, is an independently operated affiliate of CBRE Group Inc. (NYSE: CBRE), the world’s largest commercial real estate services and investment firm, based on 2021 revenue that grew 16% to $27.7 billion.
CBRE is the largest commercial broker in Orange County, reporting $6.9 billion worth of sales and leases for 2021, according to the Business Journal’s annual list. It’s also the county’s third largest property manager, managing 15.8 million square feet.
CBRE said medical office assets are expected to outperform the office market overall because they average vacancies about 2% lower than traditional offices as the work of medical practitioners often requires an in-office presence.
The Mission Viejo complex recently underwent major renovations that include new gurney-sized elevators, upgraded landscaping, and sustainability elements including new HVAC roof systems, LED lights and recycled water landscaping.