By Veronica Grecu
Vancouver-based City Office REIT has recently expanded its commercial portfolio with the acquisition of two office campuses encompassing 10 buildings located in the Mission Valley and Sorrento Mesa submarkets of San Diego. The aggregate purchase price was $174.5 million and the transaction closed in late September.
“This acquisition gives us immediate scale and diversification in San Diego, a market that is characterized by high quality of life, strong demographics, positive employment and population growth trends and high barriers to entry for new supply,” James Farrar, CEO of City Office, said in prepared remarks. “With this off market transaction, City Office has acquired over $1.0 billion in total real estate. We are also excited about the opportunities to unlock further value through strategic capital improvements, building remeasurement and re-tenanting space at market rents.”
All The Details
Sorrento Mesa is the largest piece of the portfolio and comprises 384,558 square feet of Class B space in six buildings located at 10390, 10394, 10398, 10421, 10445 and 10455 Pacific Center Court. Completed in mid-1990s and previously owned by Kilroy Realty, all buildings feature efficient floor plans, ample clear heights and desirable window lines suitable for office, flex, lab, and research and development use. This portfolio also includes a five-acre land parcel that is located right next to Qualcomm’s world headquarters and offers prime development opportunities in one of the top, low-vacancy submarkets in San Diego. The Sorrento Mesa office complex is 88 percent net leased to tenants primarily within the life sciences, technology and defense industries.
Mission City Corporate Center, is a four-building Class A office campus located at 2355 Northside Drive in the heart of Mission Valley, San Diego’s most modern “live-work-play” submarket. The 285,095-square-foot property was built between 1991 and 2008 and fully renovated in 2010, and was also previously owned by Kilroy Realty. It is located near five major freeways and several local amenities including luxury hotels and restaurants. Mission City Corporate Center is currently 88 percent leased to a rent roll of tenants primarily in the financial, tech, healthcare, legal and insurance sectors.
A recent Mission Valley transaction includes Vista Investment Group’s acquisition of Plaza 2020, a 10-story tower.
Image courtesy of Yardi Matrix