Coretrust Picks Up 640 KSF Pasadena Office Campus
- May 24, 2018
Corporate Center Pasadena, a four-building office complex and the largest office campus in Pasadena, Calif., has a new owner that’s planning a major makeover. Coretrust Capital Partners acquired the LEED Gold properties through its investment fund, Coretrust Value Fund I. According to Yardi Matrix data, UBS Realty Investors sold the asset, located at201, 225, 251 and 283 S. Lake Ave., for $260 million.
“This is a rare opportunity to own a major and well-located campus and bring to it all of the amenities most sought by today’s tenants,” John Sischo, Coretrust managing principal, said in a prepared statement. “We intend to transform Corporate Center Pasadena into one of the most desirable office environments in the city, appealing to professional firms, technology companies and corporate headquarters.”
Coretrust is set to invest more than $90 million in the campus, including upgrading the buildings with state-of-the-art technology. All lobbies will be updated and elevators will be modernized. The company plans to add more on-site businesses to service tenants and create more public spaces including plazas, gardens and terraces.
The six-acre complex takes up a full city block. It has more than 640,000 square feet of commercial space with about 600,000 square feet of offices and more than 40,000 square feet of amenity retail, including an LA Fitness center on the ground floor of 201 S. Lake Ave. The asset also has a 60,000-square-foot plaza and more than 2,000 parking stalls.
Sischo cited the Pasadena campus’ location as a strong asset. The property is in the heart of the popular South Lake Avenue retail district near numerous restaurants and new multifamily developments. It is within walking distance of the Metro Gold Line and close to the 210, 134 and 110 freeways.
Coretrust’s specialty is acquiring older, high-quality, well-located office properties and transforming them into modern office venues. Last January, the firm purchased the 48-story Citigroup Center office tower at 444 S. Flower St. in downtown Los Angeles for $336 million, also through its Coretrust Value Fund I. Coretrust is in the midst of a renovation and repositioning at the tower estimated to cost more than $50 million.
Market and tenant mix
The occupancy at the Pasadena complex is about 88 percent. Office tenants include numerous law and financial services firms. Average asking rents range between $38.27 and $39.60 per square foot, according to Yardi Matrix data.
A recent office market report from Colliers International notes that demand was negative 69,400 square feet in the first quarter, mostly on the strength of mid-sized to small tenants. While both Pasadena and nearby Burbank have large blocks of office space available, Colliers expects leasing demand, particularly for smaller tenants, to dominate activity in markets like Pasadena.
“The Tri-Cities market continues to be an attractive market for tenants from a variety of industries,” the report stated.
One of the larger Tri-Cities transactions occurred earlier this year when Los Angeles-based CBRE Global Investors acquired two Glendale, Calif., office towers totally nearly 427,000 square feet for $122 million. The buildings at 801 N. Brand Blvd. and 700 N. Central Ave. were purchased through the CBRE Strategic Partners U.S. Value 8 Fund.
Image courtesy of Coretrust Capital Partners