Birtcher Buys Arizona Firm; Pinnacle Has Four Projects Going
COMERCIAL
Twenty-eight years after making his debut in the Orange County real estate market,at a time when most businessmen think of gearing down,Erik Hansen is beginning anew. Hansen recently stepped down from his post as senior vice president and partner at Legacy Partners to start his own commercial real estate business, EMH Commercial Real Estate Co.
He believes he left Foster City-based Legacy in good shape. His replacement is John Miller, who “brings a strong LA and office focus to the company,” he said.
Hansen sat down last week to discuss his past, present and future as a commercial real estate developer in Orange County.
Hansen said he can’t afford to slow down, not with a son at Stanford University and two daughters at Princeton University. An ironic statement considering Hansen’s involvement in the sale of more than 19 million square feet, totaling $1.4 billion since 1981.
But talking with Hansen, you get the feeling he does it for more than just the money,he loves the art of the deal. Since 1972, he has watched deals come and go, watched the market rise and fall.
So he’s not too concerned that he chose an uncertain time to start his own firm.
“Things are looking a little choppy out there,” Hansen said. “It’s a little bit down from the perspective of the last few years.”
But Hansen knows the iffy market is nothing compared with the one 10 years ago.
“Vacancy rates for office and industrial were twice what they are today. So we are in a wonderful position, relatively,” he said.
In 1991, vacancy rates for office and industrial were as high as 20% in some areas. Today, they are close to 10% for office and 5% for industrial, according to Hansen.
“I know I’m entering a challenging market, Hansen said.
“Landlords were giving away one to one-and-a-half years free rent on five-year leases (in 1991). You’re not seeing that anymore. It’s not even close,” said Hansen.
Having been managing partner and senior vice president for Legacy Partners, where one of his last projects was Mission Ridge, Hansen sees himself focusing on the same thing at EMH, only on a smaller scale.
“We’re going to focus on office or industrial midsize projects,” Hansen said.
He feels comfortable working on $5 million to $25 million projects, at least initially.
As for the office culture, Hansen said the difference there will be a big one.
“I can’t holler out the door, ‘Hey, can you go fix this? What’s the deal with this construction project?’ Now, I have to handle it all myself.”
For now, Hansen said he is concerned with projects that include environmental and contaminated sites, or the redevelopment of brownfields, “that land covering a good part of Los Angeles,” quipped Hansen.
Other projects include build-to-suits, value-added acquisitions that can be turned around quickly.
“Everything needs to be tighter today,” Hansen said. “The low-hanging fruit has long since been picked. Now we’re climbing out on the branches, reaching for those last pieces of fruit.”
Birtcher Buys Arizona Firm
Birtcher Real Estate Group has increased its presence in Arizona. Headquartered in Laguna Niguel, Birtcher acquired Marathon Management to form Birtcher Arizona LLC.
The transaction adds 1.2 million square feet to Birtcher’s Arizona holdings. It also signals Birtcher’s increasing relationship with Amberjack Ltd., whose 54-acre development project with Marathon will continue with Birtcher Arizona. Birtcher and Amberjack have partnered on several projects in Arizona in the past.
Bob Anderson, co-chairman and president of the Birtcher Group, negotiated the deal on Birtcher’s behalf and is responsible for integrating the two organizations.
“The greater Phoenix area has one of the fastest-growing population bases in the U.S. due to the low housing costs, colleges, and recreational and geographic diversity,” said Anderson.
In another deal, Birtcher acquired Buena Park Commerce Plaza at the corner of Beach Boulevard and Manchester Avenue. The multi-tenant office buildings total 150,000 square feet. The plaza is 90% leased with tenants including CNF Inc.’s Con-Way Transportation Services and Wescom Credit Union.
Birtcher partnered with the Paradigm Group in the $13.5 million deal.
Marc Renard of Cushman & Wakefield, LA, represented both the buyers and seller Cornerstone Real Estate Advisors.
RESIDENTIAL
Irvine-based Pinnacle Communities has four new neighborhood communities in various stages of development. The homebuilder has two projects set for the Thousand Oaks area and one each in Oceanside and Chino. Pinnacle expects all four to be available by the summer.
In another deal, Pinnacle purchased Chino Equestrian Estates in Chino. A 38-acre project, Chino Equestrian Estates will 65 single-family lots, with homes ranging from 3,000 square feet to 4,000 square feet. Mac O’Donnell and Steve Jones, of O’DonnellAtkins Co. represented both Pinnacle and the seller, STG Hillsboro Estates LLC I, in the deal.
