Newport Beach-based Burnham-Ward Properties has expanded its hometown office holdings with a property not too far from John Wayne Airport.
The privately held commercial real estate investor and developer recently completed the purchase of 4220 Von Karman Ave., a two-story office in Newport Beach across the street from the Pacific Club. The building runs about 28,000 square feet.
It’s the first office deal in the immediate area for the investor, according to Bryon Ward, a partner in Burnham-Ward Properties, which is affiliated with Burnham USA Equities.
Most of Burnham’s local office holdings are in Newport Center, as well as the Westcliff Drive-17th Street corridor that straddles Newport Beach and Costa Mesa.
The developers also own the South Coast Collection design and culinary center in Costa Mesa, among other area retail holdings.
More office deals in the airport area are being considered, Ward said.
“We have our eyes on some other acquisitions” in the area, he said. “We are excited to expand our footprint.”
The stretch of Von Karman Avenue that includes Burnham’s latest purchase has a collection of small- and midsize offices that house a good number of local real estate companies and professional services firms, among other tenants.
Buildings in the area—located between Birch Avenue and MacArthur Boulevard in the Koll Center Newport office campus—often fetch premium prices, especially on a per-square-foot basis. Most sales have approached the $300-per-square-foot mark in recent years, with some ranging as high as $800.
The average sale price of an office in Orange County ran $198 per square foot last quarter, according to data from Newmark Grubb Knight Frank.
Burnham officials didn’t disclose the price it paid for 4220 Von Karman, but CoStar Group Inc. records suggest the company found a relative bargain.
The property tracker’s records put a $7.4 million price on the deal, which works out to a price of $264 per square foot.
The building had been listed for sale at $9 million about four years by prior ownership, which subsequently turned over the property to its lenders after failing to reach a deal to sell the office.
LNR Property
Burnham-Ward bought the property from Miami-based LNR Property Corp., one of the country’s largest managers of distressed commercial loans.
CBRE Group Inc. Executive Vice President Gary Stache represented Burnham-Ward and LNR in the deal.
The building was largely empty at the time of its sale to Burnham-Ward, but the new owners already have filled a big portion of that vacancy.
The entire 14,000-square-foot second floor of the office building was preleased during the escrow period to Bergener & Associates, a California personal injury law firm that is moving from the MacArthur Court office complex.
John Pomer and Ben Gott with Stream Realty worked together with Justin Hodgdon at Newmark Grubb Knight Frank in representing Burnham-Ward Properties and Bergener & Associates in the lease.
Up to 14,000 square feet of ground floor space will soon be available for lease, according to Ward, whose company is planning some renovations to the property.
Upgrades planned for the office include “completely renovated” creative interiors, a new entrance, landscape work, and outdoor work space, he said.
The project is one of two notable office renovations that Burnham-Ward has under way in Newport Beach.
It also is redeveloping 1617 Westcliff Drive, a two-story building it owns near the Newport Beach-Costa Mesa city line.
The project—now called Castaway Commons—will see the 32,000-square-foot property, a 1960s-era building that’s currently home to several well-known medical tenants—turned into a mixed-use project with unique retail spaces and the first Orange County location of Café Gratitude, an L.A.-based organic-food restaurant concept.
The developers bought the Westcliff property out of bankruptcy in 2014.
