Irvine Co. has kicked off work on the next phase of construction at its Innovation Office Park campus along the Santa Ana (5) Freeway, with company officials citing confidence in the future of its sizeable office portfolio post-pandemic.
The Newport Beach real estate firm recently began building a collection of seven low-rise buildings in the Irvine Spectrum area, near Sand Canyon Avenue and the 5 Freeway.
The seven buildings—ranging in size from 20,000 to 64,000 square feet—will total about 260,000 square feet. They are expected to be completed later this year.
Innovation Office Park, when fully built out, will feature about 1.1 million square feet of buildings spread over 73 acres.
Irvine Co. is the largest owner of offices in California, with much of its holdings in Orange County.
Its portfolio of more than 560 buildings tops 50 million square feet of space.
The latest phase of the project, along with Irvine Co.’s nearby Spectrum Terrace development—which is now seeing its third and final phase of construction move ahead—are two of the largest speculative office projects currently underway in Southern California.
Despite questions over how OC’s office market will shake out amid remote working and other pandemic-induced trends of late, Irvine Co. officials say that recent leasing success at its new Spectrum-area projects is proof that certain types of companies want to remain office-centric in their operations.
The first phase of Innovation Office Park, which was built about a year ago, totaled nearly 300,000 square feet. That phase is about 65% leased, though not all tenants have moved in yet, Steve Case, executive vice president for Irvine Co.’s office division, told the Business Journal last week.
While the first batch of offices at the campus was geared toward small and midsized tenants, the under-construction phase is seeing interest from some larger-sized tenants, Case said.
Gamers, Banks, Fintech
Initial tenants include a host of video game-related companies, including Sega of America, Postcard Game Studio, Frost Giant Studios, and Notorious Studios.
Other tenants include BCCB LLC, the organizing entity for Beach Cities Commercial Bank, an Irvine-based institution that’s in the process of getting regulatory approvals to start operations.
In its deposit insurance application with the Federal Deposit Insurance Corp., Beach Cities “said that it will be headquartered in Irvine to serve the Orange County market, while a second full-service branch in Encinitas will serve the San Diego County area,” according to a recent report by S&P; Global.
The bank’s primary clients will be small and medium-sized businesses, business owners, and business professionals, the report said.
Also, among the first batch of tenants at Innovation Office Park: Finfare Inc., an upstart fintech firm with a focus on AI-powered payment systems. It began operations last year, according to state filings.
Finfare’s LinkedIn page indicates it raised $20 million in funding last year; it’s one of a few tenants at the campus with sizeable funding deals of late. Frost Giant, which is developing a real-time strategy video game, announced a $25 million round of funds earlier this year.
“We’re highly encouraged” by the leasing activity, Case said, who noted that Irvine Co’s “premium workspace” is seeing plenty of demand.
Newer offices by Irvine Co. prioritize health and wellness, via advanced air filtration systems, indoor and outdoor fitness areas, and an abundance of other amenities, the landlord says.
Many of these offerings were developed pre-pandemic and refined over the course of the past two years, according to Case.
The first step in building an office project for the future “is creating the healthiest work environment,” Case said. Then, the landlord worked on “amenities, and creating a sense of place,” in a manner like what Irvine Co. has done at its shopping centers, apartment complexes and resorts, he said.
In the case of Innovation Office Park, the campus has many of the features of a traditional creative office project—open ceilings, operable windows, roll-up doors and open-air design—but with more wellness and health additions than is the norm, Irvine Co. officials say.