International real estate investment and development firm Hines has kicked off 2022 on an acquisition and development push in Orange County, thanks to a newly launched fund that aims to redevelop properties in large U.S. markets.
The firm, whose Newport Beach office has been among the more active local commercial property investors over the past decade in the office, industrial, and multifamily sectors, earlier this month announced the launch of the Hines U.S. Property Recovery Fund.
It’s described as the “first in the firm’s new flagship tactical fund series in the United States with approximately $590 million of equity committed, giving the fund nearly $1.5 billion in immediate investment capacity,” the company said in a statement.
In total, the fund is targeting a final equity raise of $1 billion, with purchasing power of $2.5 billion after leverage, it said. The fund is expected to close in May.
Houston-based Hines has $83.6 billion in assets under management and a portfolio of 138.3 million square feet for third-party property-level services.
Santa Ana Start
The new fund already has two California properties under its umbrella, including one in Santa Ana.
Records show Hines paid a little over $20 million for 3130 Fairview, a 3.9-acre site just south of Segerstrom Avenue and near Segerstrom High School.
It’s close to the expanding operations of flying taxi developer Overair, which occupies nearly 200,000 square feet of space in the area, and next to the headquarters of R&B; Wire Products, one of the largest family-owned businesses in Santa Ana.
The site has long been used as an RV storage facility. Hines said the space will make way for an 82,000-square-foot industrial facility. Construction will start in the last quarter of the year, it said.
The deal works out to a price of around $5.1 million an acre. The seller was an Anaheim-based family, property records indicate.
Hines also said the new fund bought a 25-acre site in San Jose, where a 414,000-square-foot industrial project is planned.
For future acquisitions, the fund aims to target “tactical investment opportunities across 30 of the largest U.S. metropolitan statistical areas,” with a goal to “reimagine standing assets and develop new assets—all with the goal of creating future-facing real estate that aligns with shifting occupier and investor preferences.”
Along with the $20 million purchase in Santa Ana, the Business Journal has learned that Hines has just made a larger acquisition, via a different investment fund, in Tustin.
It paid $50 million for a building used by Avid Bioservices Inc. (Nasdaq: CDMO) for its expanding drug manufacturing operations. See next week’s print edition of the Business Journal for more on that deal.