An engineering firm that’s more than a century old is moving its headquarters from Rancho Dominguez to Orange County.
The company, Murray Company Mechanical Contractors, recently paid $19 million for a 104,734-square-foot office building at 5995 Plaza Drive in Cypress, near the San Diego (405) and Garden Grove (22) Freeway junction.
The deal for the five-story building, built in 1986, works out to around $181 per square foot.
Murray, whose founding dates to 1913, is currently based out of an industrial facility it owns in Rancho Dominguez, about 17 miles away from the new headquarters.
The company bought the Cypress office from Healthcare Realty Trust Inc. (NYSE: HR), which parted with the building at a 26% discount to its prior valuation. The Nashville-based medical real estate investment trust acquired the building in 2008 for $25.7 million, or roughly $247 per square foot, when it was fully leased to a unit of United Healthcare.
The building’s discounted price “offered [Murray] a great opportunity to purchase a new location,” Daum Commercial Real Estate Services’ Christopher Migliori, who represented Murray, said in a statement.
The value of such buildings has remained low as “the overall office market continues to navigate challenges due to the post-pandemic declines in tenant interest, sales volume, lease rates and absorption,” Migliori added.
The 5995 Plaza Drive property is nearly triple the size of Murray’s current headquarters, which runs 36,293 square feet at 18414 S. Santa Fe Ave. in Rancho Dominguez.
Murray aims to house over 250 employees at the new office.
Migliori and Danielle Knudson of Daum represented Murray, while CBRE Group Inc.’s Tom Sheets and Quint Carroll brokered the deal on behalf of Healthcare Realty.
Extensive Remodel
Murray is planning an extensive remodel for its new headquarters. The company is hoping to move into the space before the end of the year, according to Knudson.
Murray’s corporate staff is currently located at a pair of industrial facilities it owns in Rancho Dominguez.
The Cypress building will allow the company to consolidate its employees into one office.
Murray paid $8.3 million for the two industrial properties it owns in Rancho Dominguez—a manufacturing facility and warehouse located at 18414 and 18416 S. Santa Fe Ave.
The company intends to continue using those buildings—which run a combined 82,443 square feet—after the move to Cypress, Knudson said.
Selling Spree
Healthcare Realty, which was valued at $5.2 billion as of last week, has been on a selling spree over the past year, including the sale of 5995 Plaza Drive.
The company in 2023 sold a total of 10 properties for a combined $143 million.
The year-long retrenchment came as Healthcare Realty’s 2023 financial results missed analysts’ estimates.
The REIT’s Southern California portfolio as of a few years ago topped 1 million square feet, following a buying spree that included several buildings near some of OC’s larger hospitals.
