Brookwood Financial Sells San Diego Office Portfolio

Carlsbad Executive Plaza. Image courtesy of Cushman & Wakefield

Brookwood Financial has sold a two-property office portfolio in Carlsbad, Calif., with the assistance of Cushman & Wakefield.

M.C. Strauss acquired Carlsbad Executive Plaza and The Plaza, two Class A assets totaling 222,000 square feet. CommercialEdge data shows Brookwood had purchased both campuses in 2015 for a combined $40.6 million.

The 133,136-square-foot Carlsbad Executive Plaza is made up of four office buildings, each three stories tall, completed throughout the 1980s and 1990s. The asset features a courtyard café, koi ponds and lounge areas. Situated at 2111, 2121, 2131 and 2141 Palomar Airport Road, the campus is near the entrance to the McClellan-Palomar Airport.

READ ALSO: Economist’s View: How Inflation Will Impact Property Valuations

Brookwood completed some $2.6 million in capital improvements at the property that was 77.5 percent leased at the time of sale. According to CommercialEdge data, current tenants at the Carlsbad Executive Plaza include Cardinal Industrial, WWM Financial and Maxim Healthcare Services, among others.

The Plaza. Image courtesy of Cushman & Wakefield

The Plaza is a two-building, Class A office campus totaling 88,869 square feet. Built in the late 1980s, the property was 68.3 percent leased when M.C. Strauss acquired it.

Located at 1921 and 1925 Palomar Oaks Way, the property is roughly 1 mile from Carlsbad Executive Plaza. Its tenant roster features a diverse mix of companies such as National Search Associates, Integrity Applications and Fitzpatrick Capital, according to CommercialEdge data.

Rick Reeder, Brad Tecca, Tanner Harris and Kevin Donner with Cushman & Wakefield’s Capital Markets team in Southern California represented Brookwood Financial in the deal. The firm’s Justin Halenza and Matt Sundberg provided leasing advisory.

A strong office market

In prepared remarks, Tecca said that the Carlsbad office market fundamentals are improving as inventory lessens due to life science conversions. He added that the city has seen nearly 165,000 square feet of office occupancy growth year-to-date as of September, among the highest submarket levels countywide.

The general San Diego area seems to be similarly performing well. According to a recent CommercialEdge national office report, the metro’s office market has seen an increase of 12.6 percent in listing rates in the last 12 months, closing September with an average $43.91 per square foot. The pipeline totaled nearly 4 million square feet of office space.