The largest public university in the county by enrollment, with 41,408 students, said it has accepted a purchase agreement for its two Irvine properties, about 138,000 square feet combined, at 1 and 3 Banting in Irvine.
The buyer’s identity, or the price being paid for the buildings not far from the headquarters of device maker Masimo Corp. (Nasdaq: MASI), has not been disclosed.
“Due to the size and cost of maintaining the Irvine Center, it has been challenging for the university to utilize the property to the fullest extent,” President Fram Virjee said in a Jan. 25 letter.
The property is now in escrow. Once the sale is completed, the university—which continues to offer the majority of its classes remotely—will lease back space through its academic year ending June 30.
“Easing this transition further will likely be a continued interest in virtual pedagogy as a part of a menu of teaching and learning options, post-pandemic,” Virjee said.
While the use of Zoom and other virtual technologies are expected to stick around, Cal State Fullerton is expected to return to in-person instruction in the fall.
“We are seeing glimmers of hope for the future, and we at Cal State Fullerton are excited and hopeful to return to campus for primarily in-person instruction beginning with the fall 2021 semester,” Virjee said.
The closure will mark, for now, the end of the university’s physical presence in South OC after nearly three decades.
Cal State Fullerton has operated a separate campus to serve students living or working in Central and South OC since 1989, initially at the Saddleback College campus in Mission Viejo. It moved the campus to the El Toro Marine Corps Air Station in 2002 and later relocated it to the Banting Corporate Center in 2011.
CSUF Auxiliary Service Corp. purchased the two properties at the Banting Corporate Center in 2013 for a reported $30.5 million.
3 Banting offered classes for about 400 students pre-pandemic and houses the student-run public relations agency PRactival Advantage and the Small Business Development Center, as well as the CSUF Startup Incubator.
Those tenants “will move to the Fullerton campus or another location” at the end of the lease-back period, the school said.
The majority of 1 Banting was previously leased to Western State College of Law, which had paid about $150,000 a month in rent.
“This past year, just as the pandemic hit, Western Law School’s lease ended on Banting 1, leaving the university with no suitable tenant for the space and no demand to fill it with our faculty, staff and students—the majority of whom were (and still are) working and learning remotely,” Virjee said.
The university decided to put 1 Banting on the market, with an asking price of $21 million, according to marketing materials from listing broker CBRE Group Inc.
After it received multiple offers to sell both properties together, it prompted the decision to sell the entire campus, CSUF said.
The school said it is “reviewing the workforce needs of the region and evaluating the most appropriate academic areas” to build any future presence in South OC.
The sale comes as Cal State Fullerton grapples with mounting financial challenges.
The state, which provides about half of the university’s funds, cut about $24 million, or 5%, to its annual budget.
That’s on top of lost income and unplanned expenses that totaled about $75 million as of December, officials said.
Cal State Fullerton issued about $9 million in refunds for canceled housing contracts, dining plans and parking permits last spring.
It also invested in digital technologies and education such as $3 million to put cameras in classrooms and about $1 million per quarter for teacher training.
With an in-person return in the fall, the university said it expects to make further investments in personal protective equipment, sanitation measures and other student support services.
“We still have a huge commitment to South Orange County,” Virjee said. “We’re the only Cal State in Orange County—the sixth largest populated county in the country and the third largest economy in the state.”