The purchase of a San Juan Capistrano office park and the sale of a prominent government building next to the Outlets at Orange shopping center have capped off a busy few weeks of investment activity for Greenlaw Partners.
The Irvine-based real estate investor has been involved in nearly $111 million in transactions since the end of August, including the sales of properties in Orange, Santa Fe Springs and Carlsbad.
The company, which owns a variety of office, industrial and retail properties across Southern California and other markets, still has its sights on opportunistic purchases in the area, according to Wil Smith, Greenlaw principal.
“We’re always looking for value,” said Smith, who founded Greenlaw in 2003 and has seen his company grow its portfolio to more than 4 million square feet.
Besides its office portfolio, its best-known local property is the Costa Mesa food and entertainment center The Triangle.
Its latest investment is in San Juan Capistrano, where it recently completed the purchase of the Westcore Executive Center, a two-building property overlooking the San Diego (I-5) Freeway near the entrance to the San Joaquin Hills (73) Toll Road.
It paid about $23.8 million, or $206 per square foot, for the 115,517-square-foot property, which is one of the newest office developments in South Orange County.
Smith said his company plans to rename the San Juan Capistrano property in the next few months.
The center opened in 2007 as Mammoth Professional Office Park. Its original owners turned over the property to lenders in the last recession.
San Diego-based Westcore Properties paid nearly $17 million for it in 2010 when it was about 40% full. It is now about 85% leased to a host of smaller tenants.
The recovery is moving ahead faster in South County, “especially for small-tenant and multitenant buildings,” said Jeff Cole, executive director for the Irvine office of Cushman & Wakefield Inc., who brokered the deal along with colleagues Jeff Chiate, Ed Hernandez, and John Gallivan.
The deal is one of this year’s largest OC office sales south of Irvine.
Small-business owners who live in the south part of the county are increasingly looking for office space closer to their homes rather than locations around John Wayne Airport, Cole said.
“South Orange County is hot right now,” Cole said.
“We successfully stabilized this property within four years and felt now was a good time to sell,” said Don Ankeny, president and chief executive for Westcore.
FBI Office Sale
A similar strategy recently played out in Orange, where Greenlaw sold the 4000 Metropolitan Drive office, a 183,000-square-foot building just off the Garden Grove (22) Freeway near the Outlets at Orange.
An affiliate of Boston-based Spaulding & Slye Investments that buys government-leased buildings acquired the four-story office for about $56 million, according to Greenlaw officials.
The building is nearly full, and tenants include the FBI. Greenlaw paid a little less than $12 million in 2010 for the building, which was largely empty at the time.
4000 Metropolitan is one of several offices it owned in the vicinity of the 757,000-square-foot Outlets shopping center, including City Plaza, a 19-story office that holds a bulk of the operations of Anaheim-based mortgage and consumer lender CashCall Inc.
Greenlaw and Chicago’s Walton Street Capital LLC, a frequent partner in local deals, paid $56 million last year for the 334,000-square-foot City Plaza, one of the most prominent offices in Central Orange County
In June, the two partnered to buy a pair of offices in Orange, the City Parkway Collection office portfolio at 500 and 600 City Parkway W.
The offices total 269,395 square feet and sold for about $45.5 million, or $169 per square foot.
Greenlaw is now looking to build upward of 800 apartments and perhaps a 20-story office tower on excess land it owns near the Outlets mall.
The just-concluded sale of the 4000 Metropolitan office shouldn’t impede those plans, according to Smith.
Greenlaw hasn’t disclosed a time frame for any apartment or office development in Orange. It said that by next year it will start work on a multilevel parking structure on its land, a project that would free up space for the apartments or the office tower, Smith said earlier this summer.
Out-of-Town Sales
A few other recent sales outside OC could help Greenlaw supply cash for any apartment or office development in Orange, as well as additional purchases.
At the Los Nietos Business Center in Santa Fe Springs, it sold a 154,000-square foot warehouse to Windsor Fashions, a Vernon-based garment distributor that will be using a majority of the building for its own operations.
The building sold for about $15.8 million, according to CoStar Group Inc. records.
In Carlsbad, Greenlaw and Walton Street sold an office building called the Crossings Corporate Center for about $15.3 million.
An affiliate of Miami-based institutional investor Rialto Capital Management LLC paid about $15.3 million for the 71,652-square-foot office, which was reported to be about two-thirds occupied at the time of the sale.
