Parker Properties LP has sold the second phase of the Summit Office Campus to the State Teachers Retirement System of Ohio and plans to use the proceeds to fund future development projects.
In acquiring three office buildings totaling 315,000 square feet, the pension fund paid an undisclosed amount to AEW/Parker LLC, a joint venture of Boston-based AEW Capital Management and Aliso Viejo-based Parker Properties.
“From a company standpoint, we feel this provides Parker Properties with a solid platform over the next few years in terms of generating new business beyond the Summit,” said Todd Burnight, a principal with Parker Prop-erties. “We are actively looking at both acquisition and development deals in other markets as well as concentrating on developing the next 1 million square feet we have entitled at the Summit.”
Earlier this spring, Wilmington, Del.-based MBNA Corp. agreed to a five-year, 48,000-square-foot lease with Parker Properties, filling up phase II and making it an optimum time to sell the property, according to Burnight.
“The fact that it was 100% leased and has such a diverse tenant mix of tech and traditional companies made it a good investment,” he added.
Other tenants in phase II include Enfrastructure, ThinkTank and the law firms Bridgford, Knottnerus and Gleason, and Stetina, Brunda, Garred and Brucker.
“OhioSTRS was a logical buyer in that they already had an involvement and familiarity with the project,” Burnight said.
With its Western regional office in San Francisco, the Ohio pension fund already holds property in Orange County. The company owns the Wells Fargo Tower in the John Wayne Airport area, acquired from a group including AEW in 1998. In July 1999, the fund purchased the first two buildings of phase I of the Summit Office Campus for $31 million. The fund expressed interest in the phase II property at that time, but Parker officials said then that they wanted to hold it for a couple of years.
Although selling off portions of the project always has been part of the developer’s plan, Parker retains control and management of the properties, keeping the Summit a single, integrated office park, Burnight said.
Don’t look for Parker to sell off any more of the property any time soon, he said.
“We’re looking more to hang on to the future phases,” Burnight said.
The Summit is set to total 1.7 million square feet of office space in 16 buildings on 70 acres upon completion. To date, Parker has developed 700,000 square feet and has another 300,000 square feet under construction. Two five-story buildings have a September 2001 completion date.
“We are negotiating with tenants, both in the tech and traditional business industries,” Burnight said.
This latest phase of construction is being undertaken by Cigna/Parker LLC, a joint venture of Philadelphia-based Cigna Corp. and Parker Properties that also is planned to build the future phases at the Summit. n
