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The Real Deal 2013: Top office sales

Every week, Daily Transcript real estate editor Richard Spaulding selects a commercial real estate transaction that he feels has particular merit in its time and place. The following are Spaulding's top three office sales of 2013.

No. 1 -- Rick Reeder, Brad Tecca, Cassidy Turley

Heights at Del Mar

12770-12790 El Camino Real, Del Mar

Two-building, 218,940-square-foot, Class A campus

Total consideration: $126.36 million

About the property: The Heights at Del Mar is a two-building office complex plus a 3.96-acre lot permitted for a 90,000-square-foot building. The campus is within the Del Mar Heights sub-market. The buildings are a 140,591-square-foot life science facility occupied by Neurocrine Biosciences (Nasdaq: NBIX) at 12780 El Camino Real; and a 72,291-square-foot office building at 12790 El Camino Real. The two buildings were constructed in 2004 and are certified LEED Silver by the U.S. Green Building Council.

The office complex occupies 13.8 acres and offers on-site amenities such as a fitness center, outdoor basketball court, walking trails and an outdoor amphitheater with seating for 600 people.

Closing the deal: Cassidy Turley managing directors Rick Reeder and Brad Tecca represented the seller, DMH Campus Investors LLC, c/o Prudential Investment Management, and the buyer, Los Angeles-based Kilroy Realty Group (NYSE: KRC), acquiring as KR Heights at Del Mar. The transaction was the largest within the Del Mar Heights submarket since 2007.

“The campus was a very unique opportunity due to the fact that it contains a blend of stable occupancy that provided a steady income stream and, in addition to that, it has a value-add component: excess land. So (a buyer) had the ability to develop a additional 90,000-square-foot building,” Tecca said.

“The sale process became quite competitive due to the fact that (Del Mar) is our strongest submarket and rarely does an opportunity like The Heights become available. It was very competitive and we had a number of guys at the table wanting to buy it, but at the end of the day, we just felt so comfortable with Kilroy. They own a big, huge piece of land next door that they're trying to develop right now, so it made sense for them to buy it, but that didn't mean that they were just going to walk away with it. We had a number of institutional investors who wanted this thing.”



Heights at Del Mar

No. 2 -- Rancho Bernardo office buildings

16465 Via Esprillo, Rancho Bernardo; 11020 Via Frontera, Rancho Bernardo

Total consideration: $52.175 million

About the property: Involved in the transaction were two adjacent office buildings on Via Esprillo and Via Frontera in Rancho Bernardo, totaling approximately 106,656 square feet.

Closing the deal: An 85,300-square-foot building on 3.07 acres at 16465 Via Esprillo, San Diego, was sold for $31.8 million. The buyer was Drawbridge Discovery Corporate D LLC, care of Drawbridge Realty Trust of San Francisco. The seller was Bernardo Technology Partners III LLC, care of Menlo Equities Inc. of Newport Beach.

An 55,356-square foot building, on 2.59 acres at 11020 Via Frontera, was sold for $20.4 million. The buyer was Drawbridge Discovery Corporate C LLC. The seller was Bernardo Technology Partners I LLC.

16465 Via Esprillo

11020 Via Frontera

No. 3 -- Carmel Valley Centre buildings

11975 and 11995 El Camino Real, Carmel Valley

Total consideration: $45.4 million, cash

About the property: The Carmel Valley Centre is comprised of twin buildings totaling approximately 112,363 square feet. The 3-story buildings were constructed in 1988-89 on lots of 3.33 and 3.09 acres, respectively.

Closing the deal: The buyer was Realty Income Properties 14 LLC, of Escondido.

The seller of the property was Carmel Valley Center LLC.

Lessors were represented by Chris High and Steve Bruce, of Cushman & Wakefield. In three major transactions involving Carmel Valley Center: Last year, Siemens Corp. renewed and relocated its lease on 4,832 square feet for 65 months at $920,000, and Wave Six LLC leased 2,612 square feet for 65 months at $486,000. In early 2010, Equititrend Advisors LLC leased 3,083 square feet for 63 months at $515,000.

Carmel Valley Centre

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