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10-Acre Office Campus Planned on Irvine Site

Packaging company Scholle Corp. plans to demolish its Irvine headquarters and develop a 450,000-square-foot office campus to lease to other companies.

Scholle tapped Glendale-based Dorn Platz & Co. to develop the campus and Cushman & Wakefield Inc. to find tenants, according to Rick Kaplan, a broker in Cushman’s Irvine office.

The 10-acre site at 19500 Jamboree Road hosts Scholle’s 35,000-square-foot corporate offices, research and development and equipment engineering operations, and a swath of vacant land.

Kaplan said the proposed campus is set to include four office buildings totaling 443,000 square feet and a 7,000-square-foot restaurant.

The developer plans to break ground in spring on the first 150,000-square-foot building, according to Kaplan. He said the four-story building should be finished in early 2006.

The other three office buildings are set to follow.

“This is one of the few true office projects that is going to be constructed” near John Wayne Airport, Kaplan said.

The site is next to the Newport Gateway office towers and just across from the Food and Drug Administration’s regional headquarters on Fairchild Road.

Some other commercial sites along Jamboree and in other spots near the airport are being rezoned to encompass condominiums or apartments.

A few blocks east of Scholle’s site, the Irvine office of Phoenix-based Opus West Corp. has nixed plans for two five-story office buildings and instead plans three condominium high-rises and 341 luxury apartments.

Opus is developing the high-rises on Jamboree and Campus Drive in partnership with Scottsdale-based Geoffrey H. Edmunds & Associates Inc.

Also along Jamboree, Miami-based homebuilder Lennar Corp. and Highgate Holdings, an Irving, Texas-based real estate investor, are set to transform the former Parker Hannifin Corp. campus into 1,300 condos.

Still, the office market, and the area around John Wayne Airport in particular, appears to be gaining steam.

Commercial absorption, a key market indicator, totaled 4 million square feet in the third quarter, the highest it’s been since the second quarter of 2000, according to Voit Commercial Brokerage LP.

Absorption refers to how much space is taken off the market via leases and sales, versus how much is given back by companies vacating space.

More than a third of the total absorption was near the airport.

“Many of the businesses that left the airport area due to high pricing at the peak of the market in 2000 are returning to this area to occupy space while the pricing is still attractive,” said Jerry Holdner, vice president of market research for Voit, in a statement.

Scholle makes containers such as the plastic bags used inside wine boxes.

The company also produces specially treated plastics and paper; flexible shipping containers; marine salvage devices; and battery electrolyte.

Scholle employs more than 2,000 workers in several countries, according to its Web site.

Company officials were unavailable last week, but a source said Scholle will take office space in the initial building.

Meanwhile, the company is expected

to move its research operations to North County.

Company founder William R. Scholle packed up his family and moved west to Newport Beach in 1959, with Scholle family members remaining in Orange County and working at the company here.

A number of the bag maker’s executives also are based at the company’s suburban Chicago complex, where the company was founded.

Cushman’s Kaplan said a health club has signed for 30,000 square feet, or most of the ground floor, of the first proposed building on the Scholle site.

The redevelopment of Scholle’s land has been in the planning stages for some time.

It got bogged down when Newport Beach officials raised traffic concerns, sources said.

The project is in Irvine but borders Newport Beach.

“Newport Beach has been concerned about our increasing residential development (near John Wayne Airport),” said Michael Haack, Irvine’s manager of development services.

Haack said the Scholle family bought so-called “allowed car trips” from other sites,a practice peculiar to Irvine. The city has allocated a certain amount of traffic, measured in visits by car per day, to different development sites.

If a developer wants to exceed the number of allowable car trips, the city generally lets it buy them from other sites where they aren’t needed.

He said Irvine approved the project. Haack said the Scholles worked out a separate deal with Newport Beach for traffic concerns.

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