The Irvine Company soon may be asking, “Can you hear me now?”
Sources said the developer is close to buying the five-building Irvine Spectrum office campus of Verizon Wireless, a unit of New York-based Verizon Communications Inc.
The deal would mark a return of 30 acres at 15505 Sand Canyon Ave. to Irvine Co. hands.
Los Angeles-based Lowe Enterprises Inc. bought the land from the Irvine Co. about six years ago to build Verizon’s 450,000-square-foot low-rise campus. Back then Verizon’s wireless unit was known as AirTouch Cellular.
The Irvine Co. and Lowe Enterprises declined to comment for this story. Lowe Enterprises cited a confidentiality agreement.
In the buy, the Irvine Co. would get class A offices with a blue chip tenant. Verizon is the second largest mobile phone operator in the country behind Cingular Wireless.
Orange County’s office market is gaining momentum, according to first-quarter data. Market trackers Grubb & Ellis Co., CB Richard Ellis Group Inc. and Voit Cos. say rents are on the rise with vacancies falling.
A spokesman for Verizon declined to comment for this story, except to say its Irvine Spectrum campus houses the company’s regional headquarters that oversees 12 states in the West.
Details of a pending sale have not been disclosed.
Verizon has five years left on its lease, brokers said. The price of the buildings would depend on the terms of the lease, which are not publicly known, brokers said.
According to one estimate, the campus could go for about $100 million, or $220 per square foot. That’s a bit less than an estimate for Fluor Corp.’s Aliso Viejo headquarters, which also is for sale with the company moving to the Dallas area.
Fluor’s 100,000-square-foot building could sell for $230 per square foot to $250 per square foot, brokers said.
The Irvine Co. is believed to have the right to buy back buildings from a developer who picks up its Irvine Spectrum land, according to sources.
One broker, who asked not to be named, said there was bidding on the Verizon campus and the Irvine Co. exercised its right to match the highest bid.
That’s a twist from the last big local deal the company went after.
In fall, the Irvine Co. was top bidder on a high-rise office building in Irvine, according to sources.
But Knobbe, Martens, Olson & Bear LLP, a tenant in the building, exercised its right to match the highest bid, and walked away with 2040 Main St. for $100 million.
The history of Verizon’s campus reflects the growth and changes that mark OC’s office market.
In the late 1990s, AirTouch employed some 1,900 workers in three Irvine locations. Its 1998 announcement that it planned to move from a posh 20-story tower in Irvine to the Spectrum was seen as a big endorsement of the Irvine Co.’s development of low-rise buildings there, which appeal to tech companies.
The move made AirTouch one of the largest employers in the Spectrum.
Some other big names were in the Spectrum at the time, including disk drive maker Western Digital Corp., now based in Lake Forest after a later move.
Verizon has 2,200 workers at the Spectrum site, according to a Business Journal estimate.
The sale price of the original 30 acres never was disclosed. Industry sources estimated it sold for about $20 a square foot, for a total of $26.1 million.
Lowe said at the time that the campus would cost $80 million to $100 million to build.
