AMN Healthcare Signs 175 KSF Office Lease Renewal for San Diego Corporate HQ
- Jul 14, 2014
AMN Healthcare Services, Inc. has reached a deal on a lease renewal for its 175,000 square feet of office space at its corporate headquarters in Del Mar Heights, Calif., for approximately $120 million.
Savills Studley represented the tenant in the transaction. The deal is the largest lease transaction in San Diego County this year in terms of total dollar consideration.
“First and foremost, this is a Class A office building located in a centrally located submarket of San Diego with access to fantastic amenities, ingress and egress, and centrally located to the employer travel pattern perspective, for recruitment and retention of employees,” Douglas Lozier, Savills Studley’s senior vice president of its San Diego office, told Commercial Property Executive. “The building itself is highly amenitized and is in walking distance of multiple amenity options.”
Located at 12400 High Bluff Drive, AMN has called the location home since 2003, when Kilroy Realty Corp. constructed the 210,000-square-foot, Class A office property as a build-to-suit for the company.
The six-story, landmark office building offers easy I-5 freeway accessibility and visibility, and boasts an on-site café, fitness center, conference facilities and auditorium.
A provision in the original lease allowed AMN to terminate the contract in 2016, which was a driver to the renegotiations.
According to Lozier, by extending the lease four years early in advance of AMN’s original 2018 lease expiration, the company was able to reduce its occupancy costs by $10 million while ensuring the company’s tenancy in a desirable and well-located building.
“The contributing driver there was about occupancy cost,” he said. “They were roughly 10 years into a 15-year lease and well above market rate and this was looked at as an opportunity to reduce the occupancy costs and between now and the end of the original 2018 lease they were able to reduce costs by $10.5 million.”
As part of the lease renewal, the company was awarded an improvement allowance to retrofit the space. Planned changes include upgrades on cosmetic items, furniture and also a reconfiguration on the cafeteria and expansion of the fitness center.
“This was a win-win for everyone,” Lozier added. “The owner won’t have to worry about a large block of space becoming available and it’s always better to secure a tenant when you can than deal with a vacancy in the future.”