Redwood West executives have a simple explanation for their recent $23.2 million purchase of Newport Beach’s Bayside Square office complex, a deal that ranks among the area’s priciest per square foot.
“There are only three buildings considered part of the Newport Center-Fashion Island waterfront, and we now own two of them,” said Redwood’s John Pomer, co-founder and managing director of the Newport Beach-based commercial real estate firm.
An entity headed by Redwood’s partners completed the buy this month of the two-building complex on Bayside Drive, whose two-story buildings hold a mix of office and medical space.
The 35,000-square-foot property is directly across the harbor from Balboa Island and close to the Jamboree Road terminus. It’s about 88% leased; tenants include CosmetiCare, Newport Academy and Mischler Financial Group.
The only other for-lease waterfront office building in the vicinity is the Irvine Co.’s 341 Bayside office, which is about 11,000 square feet.
Redwood paid $23.2 million, or a little more than $660 per square foot, for the Bayside Square offices, according to property records.
It’s the highest per-square-foot price for an office property larger than 20,000 square feet this year in Orange County, and one of just a handful of similarly sized properties to sell for more than $600 per square foot over the past five years, according to CoStar Group Inc. records.
The complex was sold by Dallas-based real estate investment manager Invesco Real Estate in a deal brokered by the local capital markets team of Newmark Knight Frank, whose team included Paul Jones, Kevin Shannon and Blake Bokosky.
Invesco was part of a partnership, along with Irvine’s Shopoff Realty Investments, that paid a reported $22 million, or roughly $622 per square foot, for the complex around the start of 2016.
Invesco sold Bayside around the time it bought Costa Mesa’s Hive office complex, an $84 million deal that I profiled in last week’s Business Journal. The Hive holds the headquarters of the Los Angeles Chargers, among other tenants.
Redwood executives said they’re planning upgrades to their Newport Beach property. It’s working with SMS Architects on the plan.
“As coastal commercial real estate experts, we know the potential that this property has and are excited to optimize it,” Pomer said in a statement.
Among other area projects, Redwood has the listing for the office component of Vue Newport on Newport Boulevard near Lido Village. Vue Newport is the first ground-up waterfront office in Newport Beach for sale in 28 years, according to Redwood.
The project has about 22,000 square feet in 11 for-sale condominium units overlooking Newport Harbor. Vue Newport is a development headed by Dallas-based Third Palm Capital, an affiliate of Cayman Islands-based holding company Dart Enterprises. It includes a small amount of retail space and 27 bayfront villas and townhomes, along with the office condos.
San Diego Sale
A pair of Orange County-based real estate firms traded ownership of a creative-office complex in the Sorrento Valley area of San Diego County.
An affiliate of Costa Mesa-based Crown Realty & Development bought The Oberlin this month, a three-building complex on Oberlin Drive totaling 62,424 square feet.
The property traded hands for $20.4 million, or about $327 per square foot. It was sold by Newport Beach-based Bixby Land Co., which paid a reported $9.3 million for it four years ago when the complex was called the Mira Mesa Business Park.
It spent an additional $6.5 million upgrading the complex, which is about three miles east of the University of California-San Diego’s main campus.
It’s also close to a handful of larger office complexes acquired in the area by Newport Beach-based Irvine Co. in the past two months.
Bob Prendergast and Lynn LaChappelle of JLL represented both Crown Realty and Bixby Land in the transaction.
