Sares-Regis Group has formed a partnership with Starpointe Ventures to jointly develop a $55 million, 250,000-square-foot office complex at The Campus Centre in Irvine, expanding its investment in a big development project.
The Campus Centre development at the corner of Jamboree Road and Campus Avenue, formerly known as Koll Center South, consists of 28 acres being sold to developers by Prudential Insurance Co. of America.
Starpointe Ventures, led by longtime OC real estate developer Tim Strader Sr., previously had a deal to co-develop a 6.5-acre piece of the site with Newport Beach-based Koll Development Co. But last month, Starpointe acquired full control of that project.
For Irvine-based Sares-Regis, the Starpointe partnership is a stepping up of its involvement in the project. The company already is involved at Campus Centre, having agreed to acquire an adjoining 10-acre section of the site to develop a 548-unit luxury apartment complex. The Watermarke project, as it has been named, will be at the intersection of Campus and Carlson Avenue, off of Jamboree.
John Hagestad, managing director and principal of Sares-Regis, said the company is making a bid jointly with Starpointe Ventures to acquire the remaining land at The Campus Centre from Prudential.
“We think it’s a tremendous location,” said Hagestad. “It’s a tremendous site and it’s only gotten better with all the activity that’s taken place and the expansion associated with UCI.”
While the strong real estate market and attractive corner location are the major considerations for Hagestad at Campus Centre, Newport Beach’s Greenlight Initiative also played a part, he said.
The initiative, which aims to limit large developments and cut traffic in the city, is on the Nov. 7 ballot. If it passes, real estate just outside the borders of Newport Beach is expected to become much more attractive, since it will be much easier to launch projects there.
“Being located where it is a real distinct advantage,” Hagestad said. “That wasn’t why we got involved, but that’s not a bad side benefit or potential benefit.”
Hagestad and Starpointe’s Strader both pointed to Sares-Regis’ financial relationships as one of the main reasons for the partnership.
“They will definitely assist in bringing a financial partner to the table,” said Strader, who worked alongside Hagestad in the Koll organization during the ’70s. “I can tell you that the Sares-Regis people have some incredible financial relationships that I’m looking forward to participating in.”
Sares-Regis’ financial position strengthens Starpointe Ventures’ bid to acquire the remaining land at The Campus Centre, a piece of property that is expected to be highly sought-after by development companies.
Starpointe Ventures and Sares-Regis officials declined to discuss the prices paid for the land. But Hagestad and Strader characterized the joint venture as an equal partnership with both parties having a strong say in the pre-development and planning stages. Hagestad also made it clear that Sares-Regis will have a strong hand in day-to-day management of the project as construction gets under way.
“It’s safe to say that if we are responsible for bringing the capital to the table, we’re going to be responsible for running the day-to-day operations,” Hagestad said.
“Tim has been very involved and will continue to be very involved,” he said. “We will jointly develop the site. If we’re responsible for bringing in the capital sources that we’ve used in the past, then they’re going to look to us to oversee the development, which basically means running the day-to-day operations.”
Plans for the office portion of The Campus Centre call for a campus-style project that will feature a six-story and a four-story building similar to the ones at the Summit Office Campus project in Aliso Viejo, which is being developed by Parker Properties. As with Summit, Strader expects technology companies to dominate his tenant base.
None of the space has been pre-leased, but talks are ongoing with two parties who could take as much as 50,000 square feet, Strader said. Rental rates average $2.65 per square foot.
Construction is scheduled to begin in the late first or early second quarter on both buildings, which will be built concurrently, with completion anticipated a year later. n
