Los Angeles-based real estate investor Kilroy Realty Corp. is under contract to buy 2211 Michelson, the Irvine office tower recently put up for sale by Houston’s Hines Interests LP and partner Crescent Real Estate Equities LP of Fort Worth, Texas.
The purchase price for the 12-story building is $103 million, or about $380 per square foot for the 271,600-square-foot tower that opened its doors in mid-2007.
If the deal is completed at that price, it would be one of the highest per-square-foot prices paid for a local building since the peak of the local office market a few years ago.
There hasn’t been a prominent local office tower to trade hands at a price approaching $300 per square foot since Maguire Properties Inc.’s 3161 Michelson traded hands a little more than a year ago for that price, or $160 million. That price was 40% below its construction costs.
Unlike the plagued Maguire building, the Hines office tower is nearly full with a 92% occupancy rate. The building, a few blocks from John Wayne Airport, was put up for sale earlier this year.
The 2211 Michelson office would be the most prominent Orange County building for Kilroy, a real estate investment trust that invests in both office and industrial properties.
In Irvine, Kilroy’s largest building is a 157,000-square-foot industrial building located nearby on Von Karman Avenue that’s been vacant for several years. The landlord’s looking to convert the site into housing.
