LA Fitness Inc., the Irvine-based health club chain, is bulking up its operations.
The company plans to move its headquarters from the Irvine Spectrum to larger offices at an existing tower near John Wayne Airport.
The privately held company plans to take three floors, totaling 60,013 square feet, at Equity Office Properties Trust’s 2600 Michelson tower on Michelson Drive near Jamboree Road.
The move is expected around April.
LA Fitness is subleasing the space from Orange-based ACC Capital Holdings Corp., parent of subprime lender Ameriquest Mortgage Co. The sublease runs through the end of 2010.
The company now is based on the second floor of The Irvine Company’s 8105 Irvine Center Drive tower in the Spectrum. It has about 41,000 square feet in the 15-story building, which is next to the two towers the Irvine Co. is putting up alongside the San Diego (I-405) Freeway.
It seems as though LA Fitness found itself a bargain.
The ACC Capital space had been marketed for sublease at about $2.10 a square foot per month. The deal likely was at a rate well below that figure, real estate sources said.
Equity Office is listing other floors at 2600 Michelson, home to the Business Journal, at $3.25 per square foot, following a recent price hike by the Chicago-based landlord (see story, page 1).
The average asking rent in the airport area, where vacancy rates run about 7.6%, is $2.96 per square foot for the newest, best space, and $2.33 per square foot for older space, according to the Newport Beach-based office of Grubb & Ellis Co.
Meanwhile, LA Fitness’ old space at the Spectrum is being listed on the Irvine Co.’s Web site for $3.20 per square foot. Rates at 20-40 Pacifica, the two towers going up next door, will run from $3.60 to $4.30 per square foot.
LA Fitness counts about 180 gyms in 20 markets. It hasn’t disclosed how many employees it has locally. The new offices could support close to 250 workers.
The LA Fitness deal is the third large sublease to be announced in recent months for ACC Capital office space.
In September, Irvine cosmetics company Arbonne International LLC signed on to sublease 90,000 square feet of office space being vacated by the subprime lender at the Irvine Co.’s 3 Park Plaza tower at Jamboree Center.
In June, Santa Ana-based mortgage lender Stearns Lending Inc. said it was finalizing a deal to lease another 23,000 square feet of Jamboree Center office space being vacated by Ameriquest.
ACC Capital initiated plans six months ago to put as much as 600,000 square feet of Orange County office space, spread across eight buildings in Irvine, Anaheim and Orange, back on the market.
The moves were a result of a major corporate restructuring and downsizing effort announced by the company in March.
ACC Capital has been one of the largest tenants in Orange County, having leased close to 1.5 million square feet of space at its peak.
Real estate sources believe that the mortgage lender has likely found subleases for more than half of the 600,000 square feet.
Robert Thagard of Costa Mesa-based Orion Property Partners represented LA Fitness in the lease. John Gillespie of Newport Commercial Realty Advisors represented ACC Capital. Equity Office was represented by leasing director John Bendetti.
