Obamacare is paying local dividends for Accretive Realty Advisors Inc., an Irvine-based real estate investor and developer that specializes in medical properties.
The 12-year-old company is finishing work on San Juan Medical Center, a two-story, 40,551-square-foot medical office building next to the Santa Ana (I-5) Freeway and a few blocks north of Ortega Highway.
The project is the first exclusively medical class A office building constructed in San Juan Capistrano in the past 25 years, according to Garth Hogan, executive managing director for the global healthcare services division of Newmark Grubb Knight Frank, the brokerage tasked with leasing the property.
The building was fully leased a few months before its completion, according to Hogan, who works in the brokerage’s Newport Beach office.
MemorialCare Medical Group is leasing the entire second floor, which is approximately 25,000 square feet. Fresenius Medical Services, the U.S. division of Fresenius Medical Care AG & Co. in Germany that provides dialysis treatment services, will occupy the majority of the first floor with two other medical tenants.
Fountain Valley-based MemorialCare has already taken occupancy. The remaining tenants have begun construction on interior work and should move in by early next year.
The contractor on the project was Snyder Langston, and the architect was Ware Malcomb.
The building’s size and design were designed to cater to medical providers looking to expand and modernize as a result of the Affordable Care Act, according to Thomas LeBeau, a principal at Accretive Realty.
“The marketplace is demanding highly-efficient, visible and quality medical office buildings. There is a deficiency, especially in South Orange County, of new state-of-the-art [medical] office space to support the client and technical demands of today’s environment,” LeBeau said in a statement.
Accretive bought the nearly 5 acres for the project, which sits at the northwest corner of Rancho Viejo Road and Golf Club Drive and across the street from the Marbella Country Club, in 2013 for a reported $3.6 million.
The developer is expected to list the now fully leased property for sale this month, according to Hogan, whose team will be marketing the property.
An asking price hasn’t been disclosed. Hogan said the building is likely to trade with a capitalization rate approaching 5%.
With the San Juan Capistrano project finishing up, Accretive is turning its attention to another project it has in the works in Huntington Beach.
The company bought a two-building property next to the Huntington Beach Hospital for a reported $7.8 million in May.
The 1.8-acre site, on Beach Boulevard, included an existing 19,288-square-foot surgery center and a 29,398-square-foot medical office, both of which will be torn down to make way for a new building roughly the same size as the project Accretive has built in San Juan Capistrano, according to Hogan.
The redeveloped Huntington Beach project should mirror that of the San Juan Capistrano project, with MemorialCare and Fresenius already committing to space there, too, Hogan said.
Tustin Turnaround
Harbor Associates, a recently formed investment and development group based in Long Beach, has acquired an industrial building in Tustin where it’s planning a creative-office conversion.
The partnership between Irvine-based Bascom Group and Harbor Associates Ventures in Long Beach paid a little more that $6 million for a nearly 40,000-square-foot building at 14201 Franklin Ave., near the intersection of Jamboree Road and the Santa Ana (I-5) Freeway.
The vacant research and development building and an adjacent 1.1-acre parcel was sold by Truesdail Laboratories Inc., which moved to the Park Place office campus in Irvine earlier this year.
Jason Ward, Shawn Lawrence and Chon Kantikovit in Cushman & Wakefield Inc.’s Irvine office brokered the deal.
It’s the first Orange County purchase for the new venture, which was formed this year.
“Harbor is planning a complete retrofit of the vacant building into a progressive office environment that will feature abundant natural light and air along with multiple indoor-outdoor work and play areas,” Joon Choi, a Harbor principal, said in a statement.
“We intend to create a differentiated product that is customizable and unique.”
