The Irvine Company has dropped its interest in buying the portfolio of Los Angeles-based asset manager CommonWealth Partners LLC.
“We think that it’s a very attractive portfolio, but for reasons we decline to discuss, we’ve decided not to submit a bid,” said Irvine Co. spokesman Bill Rams.
Formal bids were expected to be made Tuesday. The 30 office buildings in five states could go for $1.5 billion or more.
The buy would have been the biggest yet for the Irvine Co. and would have been a big leap in the Newport Beach-based company’s ongoing effort to expand beyond Orange County.
Interestingly, the move would have brought the Irvine Co. into the realm of a local real estate rival,the Segerstrom family of Costa Mesa.
Pacific Arts Plaza, a four-building complex next to South Coast Plaza, is among CommonWealth’s buildings.
The Irvine Co. and others had gone through an initial qualification process, according to real estate sources.
Others that had expressed interest included Chicago-based Equity Office Properties Trust, Houston-based Hines Interests LP and New York’s J.P. Morgan Chase & Co.
The CommonWealth portfolio is owned with the California Public Employees Retirement System and New York-based The Rockefeller Group International Inc.
CalPERS initiated the sale to take advantage of rising office prices and to turn its attention to new deals, a source said.
The pension fund and CommonWealth may hold on to land zoned for development, including a proposed high-rise office building in Costa Mesa.
The Irvine Co. owns nearly 30 million square feet of commercial real estate, including 350 office buildings, 32 shopping centers and two hotels. Most are in OC.
