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The latest owner of Santa Ana’s 3 MacArthur office tower is a self-described “contrarian” investor from Los Angeles County that’s in the market to buy other high-end Southern California properties on the cheap.
El Segundo-based Highridge Partners closed earlier this month on the 246,819-square-foot 3 MacArthur office tower, which was sold by New York-based Tishman Speyer Properties LP.
The sale price was $31 million, or about $125 per square foot. Tishman paid about $83 million for MacArthur Place near the peak of the market, in mid-2007.
The building is about 75% full.
The deal had been in the works for about a month.
It’s the only OC property that Highridge owns. In fact, it appears to be the only building the real estate investor owns at all right now.
The company, founded in 1978 by John Long, made its name buying buildings during prior down markets and selling when the market was hot. Highridge sold its entire portfolio for about $1 billion in 2006 and 2007 when real estate values were last peaking.
The company believes its return to making acquisitions is likely to be seen by real estate watchers as a confidence-building signal. It said it’s looking to buy other class A buildings ranging from 100,000 to 500,000 square feet.
The new landlord said it has plans to revamp leasing and management of the 11-story building in Santa Ana, near the First American Corp. campus.
“We factor the leasing plan into our investment underwriting. To capture new tenants in this competitive market, we will offer tenant improvements packages and lease structures that will make our buildings more desirable and an easy choice for businesses,” said Jack Mahoney, Highridge executive vice president, in a statement.
Monthly rents at the building had been listed at about $2.45 prior to the ownership change.
Santa Ana-based RiverRock Real Estate Group Inc. will be handling the on-site property management for the building.
CB Richard Ellis Group Inc. will be in charge of leasing.
Tishman was represented by Michael Kane, Robert Smith, Karen Scholte, Paul Jones and Dean Chandler of CB Richard Ellis’ Newport Beach office, as well as Mark Friend of CB Richard Ellis’ Anaheim office. Highridge was represented by Kevin Shannon and Ken White of CB Richard Ellis’ South Bay office.
Brea Distributor Renews
Louis and Co., a Brea-based distributor of cabinet hardware, just renewed the lease for its corporate headquarters.
The company signed a five-year lease renewal at 895 Columbia St. Louis and Co. has occupied the 115,000-square-foot industrial building for more than 20 years. The property’s owned by Louis Investment Co., a former owner of the company who still owns the building.
The “tenant definitely considered all their options, looking at many buildings as part of this process, some of which were located outside of Orange County,” said Ben Seybold, senior vice president at CB Richard Ellis, who represented the tenants in the lease deal along with Mark Latimer and Sean Ward.
“Ultimately, the current landlord was motivated to keep them in the building,” said Seybold.
About 80 people are employed by the company in Brea. It also has 18 branch locations that serve the Western and Southwestern U.S.
Roughly 20,000 square feet of the building is office space, while the remainder of the building is warehouse and distribution space. Louis and Co. uses the space to make hardware, machinery, hand tools, laminate and solid surfaces and other supplies for cabinets.
Sares-Regis Buying
Irvine’s Sares-Regis Group has acquired a sizable industrial building in Redlands.
The developer bought the Pioneer Industrial Center, a 390,780-square-foot warehouse and distribution building that’s about 52% full. Its main tenant is Sleep Innovations Inc., a New Jersey-based bedding manufacturer, whose lease runs until mid-2013.
The property was built in 2007 and is at 9425 Nevada St., about 15 minutes east of Ontario International Airport.
The warehouse sold for about $11.5 million. The property had been listed as being up for sale at about a 6% capitalization rate.
The seller was New York-based BlackRock Inc. Jeffrey Cole, Chuck Belden and Ed Hernandez of Cushman & Wakefield Inc.’s Irvine office represented both parties in the deal.
The sale “reflects the beginning of a more promising outlook in the industrial investment sales market,” according to Cole.
