The worst of a long drought is apparently over, and the Irvine Ranch Water District should now have more time on its hands to pursue other business opportunities, in particular real estate development.
It’s in the early stages of planning an office for vacant land it owns next to its Sand Canyon Avenue headquarters on the edge of the Irvine Spectrum.
The water district filed a preapplication with the city of Irvine to build the 71,141-square-foot office at the northwest corner of Odyssey and Waterworks Way.
It hasn’t disclosed a project time frame, though it wants to line up an occupant before starting work, IRWD officials said.
Plans “are still very preliminary and have not been approved by the city of Irvine,” IRWD Director of Public Affairs Beth Beeman said in an email. “We do not anticipate moving forward with construction until we have secured a primary tenant.”
The water district is represented in its leasing activities by commercial real estate brokers at the Irvine office of Colliers International.
Busy Area
IRWD has recently built other for-lease buildings in the area. In 2012, it constructed a 16,400-square-foot medical office facility that’s leased through mid-2022.
It describes the next proposed building in regulatory filings as likely being a “medical and professional office combination” with amenities that include a central outdoor courtyard and meeting area.
Architecture firm Ware Malcomb has been working on the design, according to IRWD regulatory filings.
The project’s estimated cost is about $17.6 million. Annual income from the building would generate about $1.8 million, assuming monthly rents near $2 per square foot, according to IRWD regulatory filings made last year.
The office, which would be roughly the same size as three floors of a typical area high-rise office, would add to a busy office construction schedule on Sand Canyon Avenue.
Newport Beach-based Irvine Company is wrapping up work at two offices across the street at its Sand Canyon Business Center campus. The buildings total about 211,000 square feet, and have already signed tenants including Cavium Inc. and AutoGravity.
Irvine Co. is also planning four similarly sized offices a few blocks away at its Discovery Business Center next to the Santa Ana (I-5) Freeway.
Last year, three medical office buildings totaling about 150,000 square feet opened on Sand Canyon Avenue across the street from Hoag Hospital Irvine’s main campus in the city. They’re leased by Hoag Hospital Irvine, which is part of Newport Beach-based Hoag Memorial Hospital Presbyterian.
Buildings, Land
IRWD has a sizeable existing commercial and residential real estate portfolio in the area. It owns or has invested in properties that brought in about $2.4 million in rents in the fourth quarter, according to regulatory filings.
Its other buildings include a midsized office near The Market Place in Irvine, and the Sycamore Canyon apartment complex in Anaheim Hills that it bought in 1992 for a reported $34 million.
It also leases land used for the Strawberry Farms Golf Club in Irvine, and for cell towers.
The water district is planning a larger land transaction in Lake Forest, where it owns an 82-acre site known as Serrano Summit.
The land holds district facilities, field crops, and support structures, according to city filings. It’s near the intersection of Bake Parkway and Commercentre Drive and has been entitled for about 600 homes.
The Irvine office of brokerage Province West recently got the listing for the proposed project, according to water district records.
Based on comparable sales of residential-entitled land in the area, Serrano Summit would likely sell for more than $100 million.
A time frame for the sale hasn’t been disclosed. The water district has budgeted nearly $7 million for planning and entitlement costs.
