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October 30, 2012

Cruzan|Monroe Nabs DiamondView Tower in San Diego for $121M

By Keith Loria, Contributing Editor

San Diego-based commercial real estate investor and developer Cruzan|Monroe, along with Cigna Investments Inc., have acquired DiamondView Tower, a 15-story 305,255-square-foot Class A office tower in San Diego for $121 million.

CBRE brokered the transaction of the building on behalf of the seller, Wereldhave USA, and noted that it’s one of the largest transactions to trade hands in the San Diego market this year.

“What helped the sale was the quality of the project and the location. It’s a great designed building, great window line, great floor place and it’s surrounded by amenities,” Louay Alsadek, CBRE’s executive vice president Investment Properties, who acted as a sales broker for the property, told Commercial Property Executive. “In downtown San Diego, of the roughly 10-11 Class A buildings, more than half are owned by the Irvine Company, which is not going to be selling. That was a factor as well.”

Located at 350 Tenth Avenue, the Class A tower was the first to be developed as part of a major league ballpark in 2007, and sits just behind the right field fence of Petco Park, home of the San Diego Padres. The building offers personalized views of the field from every floor.

“Being located adjacent to the park is unique, just to be part of that energy,” Mark T. McGovern, CBRE’s senior vice president in its Debt & Equity Finance division, told CPE. “It’s in the east village of San Diego where there’s a lot of nightlife and a lot going on. There’s been a significant amount of multi-families continuing to be built in that whole area, and it’s really the part of town you would want to live, work and play.”

DiamondView Tower features a two-story lobby that opens up to the “Park at the Park,” an elaborate penthouse hospitality skybox on the entire 15th floor. It also offers the Fit Athletic Club, a state-of-the-art fitness center with an outdoor pool and deck overlooking Petco Park.

Tenants currently include the Fashion Institute of Design and Merchandising, Red Door Interactive, Cox Media, Comerica Bank and CBRE San Diego’s downtown office in addition to several creative, legal and financial firms. The building was 95 percent leased at the time of sale.

CBRE has been handling the leasing of the property since it was built, and will continue serving that function for its new owner.

“DiamondView Tower is one of the most uniquely positioned Class A office properties on the West Coast,” said Dennis Cruzan, principal of Cruzan|Monroe. “As a local owner, we are very proud to acquire the property with our partner, Cigna.”

The new owner already has some plans for DiamondView Tower.

“There are some retail opportunities on the street level and they are going to be giving some thought to liven that up a little bit,” Alsadek said. “The new ownership has a lot of experience in that sort of thing.”

McGovern, Scott Peterson and Jeff Rice of CBRE San Diego’s Debt & Equity Finance group arranged both the equity and the acquisition financing of approximately $86 million on behalf of the partnership between Cigna and Cruzan|Monroe.

Alsadek, Russell Ingram, Kevin Shannon, Evan August, Kraig Kristofferson, Stacy Meronoff and Andrew Taylor handled the sale for Wereldhave USA.