Orange County’s commercial development community was buoyed over the year ended April 30 by a surge of office openings, primarily in Irvine, the country’s biggest office market.
The dozen largest office, industrial, retail and hotel developers here completed about 4 million square feet worth of projects, based on this week’s Business Journal ranking.
That’s double the amount reflected on last year’s list, which ranked a different dozen developers, and the same amount that opened here two years earlier.
The square footage built in the two years was the most development to open since 2007, when nearly 7.8 million square feet worth of projects wrapped up.
This week’s list includes developers that completed a project larger than 50,000 square feet.
In addition to ground-up development, it also includes a handful of companies that oversaw sizable area redevelopments.
Data used to compile the list come from company submissions, CoStar Group Inc. records and Business Journal research.
Office Offerings
About two-thirds of the square footage represented on the list is office developments, and all but one of those were either in the Spectrum area of Irvine or the city’s airport-area office market.
The entries include a mix of speculative development and build-to-suit projects.
• The four-building Five Point Gateway campus near the Spectrum, at just over 1 million square feet, is the largest office project to open in the county in over a decade.
Initially designed as a campus headquarters exclusively for Broadcom Inc., the development experienced several twists following the chipmaker’s 2016 sale to out-of-town competitor Avago Technologies, which kept the Broadcom name but moved much of its domestic operations to Silicon Valley.
The campus, built by DPR Construction, is now owned by a venture headed by developer Five Point Communities, which paid about $443 million for it last summer.
Broadcom continues to lease back two of the four buildings for remaining Irvine operations, the rest being leased to other tenants, including Five Point and Lennar Corp.
• Irvine Co. continued aggressive office development in the Spectrum, opening its second glass-clad high-rise at 400 Spectrum Center, and two midrise buildings a few miles away at its Sand Canyon Business Center.
The three speculative buildings totaling about 640,000 square feet were largely leased by the time they were finished, computer security firm Cylance Inc. getting top billing at the 21-story 400 Spectrum.
The Newport Beach-based developer continues to build four additional midrises on Sand Canyon Avenue and plans to start the first phase of multibuilding speculative project Spectrum Terrace this summer.
• Trammell Crow Co. finished work at Boardwalk, the first major office project to open in the airport area of Irvine in about nine years. At 550,420 square feet, the two-building development is connected by a series of indoor and outdoor bridges, the first project of its type in OC.
Boardwalk is approaching 50% occupancy in the first few months after opening, and has some of the highest asking rents of any area property outside of Newport Center. Early tenants at the amenity-rich complex include financial firm Pathway Capital and accounting firm Holthouse Carlin & Van Trigt LLP.
Olson Duo
Irvine Co. offices weren’t the only tall buildings opening in the Spectrum area during the year.
No. 5, Newport Beach-based R.D. Olson Development, opened the 15-story Irvine Spectrum Marriott early this year, the first full-service hotel opened in Irvine in several years and one of the first Marriotts of its type in the country.
R.D. Olson added some glitz to another OC city with Newport Beach’s Lido House opening in late March. The boutique hotel, part of Marriott’s Autograph Collection, is the first new hotel to open in Newport Beach since Pelican Hill in 2007.
The two hotels totaled about 337,000 square feet, again giving R.D. Olson the distinction of being the region’s busiest hotel developer; the company has opened more hotels in California than any other firm in the past decade.
Industrial developers continued to find limited OC opportunities (see story, page 20).
Just two ground-up industrial projects are represented on the list, one 181,000-square-foot one by Western Realco, the other a joint venture between Panattoni Development and Batcheller Equities totaling about 144,000 square feet.
After a flurry of large shopping center openings that were reflected on the previous year’s list, including the 400,000-square-foot retail portion of The Source entertainment center in Buena Park—the biggest shopping center to open in OC in several years—this year’s list is largely devoid of retail development.
Only the 57,000-square-foot Porsche Dealership built in the Spectrum area by Lusardi Construction made the ranking this time.
