A pair of Tustin buildings, totaling about 200,000 square feet and located a few doors from one another on Myford Road, have sold in separate deals.
New American Funding, a growing mortgage company that had been based in Irvine, recently snapped up a two-story 83,326-square-foot office at 14511 Myford, a few blocks from the intersection of Jamboree Road and the Santa Ana (I-5) Freeway.
New American’s new building is known as the Tustin Financial Center. It sold for about $8.4 million, or about $100 per square foot, said Jeff Chiate, executive director for the Irvine office of Cushman & Wakefield Inc.
New American, which plans to use a bulk of the office for its own use, appears to have gotten a deal on the sale compared to previous prices paid for the 34-year-old office.
Santa Barbara-based Radius Investments LLC paid more than $21 million for the building, or roughly $250 per square foot, at the prerecession peak of the market in 2007.
Occupancy rates fell during the recession, and the building had been largely vacant for much of the past year. Radius Investments gave the building back to its lender, Connecticut-based Cigna Investments, in late 2011.
New America Funding is expected to occupy close to 80% of building, according to Chiate, who represented Cigna along with colleagues David Dowd and Greg Brown.
Mike Salmon, of Irvine’s Madison Street Partners, represented Myford Investors LLC, an affiliate of New America Funding, in the deal.
The sale is one of the larger office sales to an owner-user in Orange County in recent months. It also represents a big step-up in headquarters space for New American from its current offices, located a few miles away near the District at Tustin Legacy shopping center.
Surge
New American, founded in 2003, said it has seen a surge in growth the past few years. The lender funded more than 6,000 loans and did about $1.8 billion in business last year, according to trade reports.
The company has more than 100 loan officers in its residential lending division and last year started up a wholesale lending division, according to its website.
Four buildings over from New American’s new operations, Newport Beach-based developer Western Realco LLC added another industrial property to its growing local portfolio, at 14191 Myford Road.
The building had been owned by SMC Corp. of America, a Japan-based manufacturer of air cylinders, actuators, valves and other industrial products. SMC Corp.’s North American headquarters are in Indiana. The company moved out of the Tustin property about two months ago. The building was marketed for sale at $12.1 million, or $110 per square foot, and terms of the sale weren’t disclosed.
Western Realco bought the property for “much less” than the asking price, said Gary Edwards, a principal for the developer.
Scott Read, with the Newport Beach office of Grubb & Ellis Co., represented both SMC and Western Realco in the sale.
Western Realco, one of the most active industrial developers in OC the past few years, plans to put “a substantial amount of money” into the 31-year-old property. The developers aims to reposition the building into more of an office or flex-type product, said Edwards. The goal right now is to lease up the building once it’s redeveloped, although a sale to an owner-user also is also a possibility, Edwards said.
“We’re already getting interest from end-users,” he said.
The SMC industrial sale is among close to $60 million worth of property buys in and around OC that Western Realco has made the past few years. The deals have included a combination of existing properties tapped for substantial redevelopment work as well as land sites eyed for ground-up projects.
10.5 Acres
Among other notable deals that the developer’s announced this year is a 10.5-acre land site in Anaheim just outside the Platinum Triangle, at 2201 E. Cerritos Ave., just off State College Boulevard and a few blocks from the Orange (57) Freeway.
Western Realco bought the property with financial partner Penwood Real Estate Investment Management of Hartford, Conn., and is moving ahead with plans to build a 210,000-square-foot industrial building at the Anaheim site on a speculative basis. It would be one of the largest such projects announced in OC in the past five years.
The Anaheim land was sold by Pittsburgh-based Neville Chemical Co., which previously had a manufacturing building at the site but took it down about six years ago.
Western Realco also announced the purchase of a 4-acre parcel of land on Orbiter Street in Brea earlier this year. The property is near the headquarters of Beckman Coulter Inc. The developer plans to build a nearly 83,000-square-foot industrial building at the site.
Western Realco also has development plans for a 13-acre industrial property on Red Hill Avenue in Irvine that it bought last year.
