Investment manager Pimco’s diversification push into the office sector paid off, at least locally.
The bond giant’s partnership with real estate developer Hines sold the mid-rise Intersect campus in Irvine last June for $235.3M and $518 PSF, the priciest office deal in OC last year; see this week’s Top Deals of 2022 Special Report for more.
The Hines-Pimco JV bought the 452K-SF campus near John Wayne Airport in 2015 for $121.5 million, and put some $27 million into renovations for the campus, home to boutique fitness chain operator Xponential Fitness (NYSE: XPOF) and others.
Outside OC, Pimco’s recent office investments have been less successful. A report in the Wall Street Journal last week highlighted troubles for the Newport Beach firm after it bet on an office-market comeback in 2021, acquiring property owner Columbia Property Trust Inc. for nearly $3.9 billion, factoring in debt.
Columbia’s portfolio is heavy on high-rises in downtown areas like NY and San Francisco. It counts Twitter as a tenant in both cities; that tenant stopped paying rents on those buildings after being bought by Elon Musk, according to reports.
Columbia “has now defaulted on more than $1.7 billion of debt backed by seven of its buildings,” the WSJ reported last week, making it “one of the biggest office defaults during the pandemic period.”
Disruptions in the office market are also being seen in the local high-rise market; see the front page for more on declining valuations for some towers in the market around John Wayne Airport.
That hasn’t stopped developers from moving ahead on plans for new office projects. Irvine city filings indicate early-stage plans have been drawn up for a low-rise, jewel-box addition to the Von Karman Towers campus at the intersection of Michelson Drive and Von Karman Avenue.
Irvine’s Greenlaw Partners owns most of the buildings on the campus, home to Golden State Foods and others, and has partnered with the local heads of Corona’s Monster Beverage on several of its acquisitions there.
Monster Beverage’s Rodney Sacks and Hilton Schlosberg are among the biggest private investors in OC’s office market, and have other holdings nearby, including the HQ tower for law firm Knobbe Martens.
Renderings for the new two-story office plan at Von Karman Towers include some brand logos used by the $53B-valued energy drink company (Nasdaq: MNST).
It hasn’t been disclosed whether the Monster duo would be part of the project’s development team, or use the new office for their own operations.
Massiah Foundation founder and President Fariborz Maseeh, a member of the USC Viterbi School of Engineering Board of Councilors, is joining fellow CdM resident Henry Samueli, a benefactor of both UCI’s and UCLA’s engineering schools, in the National Academy of Engineering. It’s one of the highest professional honors for an engineer; fewer than 3,000 have been inducted.
Maseeh last month was named among 106 new members to the NAE, for “leadership and advances in efficient design, development, and manufacturing of microelectromechanical systems, and empowering engineering talent through public service,” the group said.
Broadcom chairman Samueli got the NAE call in 2003.
