McCarthy Cook & Co. JV Buys 213 KSF Office Campus in San Diego
- Jan 14, 2014
By Keith Loria, Contributing Editor
McCarthy Cook & Co., has teamed with AllianceBernstein U.S. Real Estate Partners, L.P., on the acquisition of Canyon Plaza, a two-building, 213,000-square-foot office campus located in San Diego, Calif.’s growing Sorrento Mesa submarket.
Lynn LaChapelle and Bob Prendergast of Jones Lang LaSalle represented the seller, a real estate investment fund advised by LaSalle Investment Management.
“It was a repositioning play in one of our top submarkets. There are many value-add investors, so it had broad appeal,” LaChapelle , JLL’s managing director of capital markets, told Commercial Property Executive. “The fundamentals of Sorrento Mesa are all positive—record absorption and rent growth to support our underwriting. The tenant in the building declared bankruptcy and the seller was fortunate to have some income from a sub-tenant.”
Canyon Plaza was built in 1986 and expanded in 1993. It is currently 49 percent leased to global health care company CareFusion Corp. and previously master-leased to Conexant Systems.
“Canyon Plaza offers an exceptional location within the submarket of Sorrento Mesa, which has been bolstered by the continued growth of the technology and health care industries,” Tom McCarthy, McCarthy Cook’s co-president, said in a company release. “The project has great bones, flexible floor-plates, great common areas and unique connectivity between the buildings. Once the renovation is completed, the project will offer an unmatched campus environment for tenants in Sorrento.”
With more than 100,000 square feet of existing vacancy, the new owners will have the opportunity to transform Canyon Plaza into one of the premier, Class A, amenity-rich office campuses in the area.
According to McCarthy, the partnership’s plan is to redevelop the common areas and lobbies and to create project amenities such as a tenant lounge, café and fitness center.
The San Diego office of Gensler Architects will lead the design efforts of the common areas and amenities. Jones Lang LaSalle has been retained to market the project to both full campus and multi-tenant users.
Although this is the first joint venture between McCarthy Cook and AllianceBernstein, according to LaChapelle , both parties are extremely experienced at repositioning assets.
“They have a strong vision for providing a unique product in the market and have a strong team of professionals to execute the strategy,” she said.
The office park is within walking distance to all of Sorrento Mesa’s retail amenities and directly across from the popular Carl Strauss Brew Gardens.