The first example of Allergan Inc. retrenching its local real estate presence in Irvine following its $72.5 billion sale to Actavis PLC is expected to take place at a high-rise office where Allergan was leasing space.
The drugmaker has been occupying three floors totaling nearly 60,000 square feet at the 2600 Michelson tower next to its headquarters.
The lease expires next February, and the expectation is that Allergan will be leaving the building when the deal ends, according to real estate sources.
It’s the only building in the area that Allergan is known to lease.
The 16-story tower is the largest office building—and the only high-rise—in the immediate vicinity of Allergan’s massive campus on Dupont Drive, which stretches between Teller and Von Karman avenues. Allergan owns the rest of the buildings on the block.
The company’s campus has expanded over the past decade through a series of acquisitions of land and offices next to its headquarters. Combined, the purchases, totaling more than 200,000 square feet, were valued at more than $50 million.
Allergan completed its most recent acquisition last July, a pair of low-rise offices on Dupont Drive totaling nearly 68,500 square feet.
The company has gone on a major belt-tightening campaign since then, prompted first by hostile takeover attempts by Valeant Inc. in Canada and later by its sale to Dublin, Ireland-based Actavis, which operates from New Jersey.
The maker of Botox, Latisse, and other products had about 2,500 workers in Orange County a year ago.
Since then it has announced several rounds of local layoffs, capped off by a disclosure this month that it will let go of 577 people in Irvine by June. The cuts will bring its local layoffs to 1,077 since October.
Assuming an average of 250 square feet per employee, the company’s local space needs have likely declined by about 270,000 square feet in the past six months. That’s about the same size as the 12-story 2211 Michelson Drive office tower about a block from Allergan’s campus.
There has been no indication that the company is looking to sell or lease out any of the properties it owns in Irvine, real estate sources tell the Business Journal.
Allergan had been rumored several times to be a potential buyer of the larger 2600 Michelson building over the past few years, including when the building was put on the market last year.
A deal to sell the building wasn’t completed then, and the 308,000-square-foot tower remains owned by a venture headed by Santa Monica real estate investor Ocean West Capital Partners.
The owners will apparently have one of the largest blocks of empty high-rise office space in the area around John Wayne Airport following Allergan’s expected departure.
Tile Buy
Tile mogul Larry Bedrosian has added another Anaheim building to his substantial real estate holdings in Orange County this month.
He completed the purchase of 1625. S. Lewis St., a nearly 110,000-square-foot industrial property not too far from the bulk of the tile and stone merchants that comprise “Tile Mile” in Anaheim.
The building sold for about $17.1 million, or $155 per square foot, according to CoStar Group Inc. records.
A unit of Rosemont, Ill.-based beer distributor Reyes Beverage Group, which has bought larger facilities in the area in recent years for its growing Orange County operations, sold the building.
Bedrosian is now believed to own more than 3 million square feet of industrial space in California, with more than 1 million square feet of that being in OC, primarily in Anaheim and Tustin.
Much of the real estate serves his company, Fresno-based Bedrosians Tile & Stone, which sells slabs for kitchens and bathrooms. The latest purchase is expected to be used by the company.
Larry Bedrosian also leases space to other companies, including Ricoh Electronics Inc., which has operations in one of his Tustin properties.
Jeff Chiate and Rick Ellison of Cushman & Wakefield Inc. represented Bedrosian in the latest Anaheim purchase, and JLL’s Louis Tomaselli represented the seller.
