Thorofare Capital Provides $42M Loan for San Diego Life Sciences Conversion
The 60,000 square foot, single-story office building will be converted into a life sciences property
By Brian Pascus May 30, 2023 1:35 pm
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Brookfield (BN) Asset Management and King Street Properties have acquired a 60,000-square-foot, single-story office building in San Diego from Nuveen for $42 million, Commercial Observer has learned.
The investment consortium plans to convert the property into a life sciences center as part of a larger $1.5 billion strategic partnership the two firms formed in 2021 to pursue life sciences conversions across U.S. markets.
Thorofare Capital provided the $42 million acquisition loan, while Eastdil Secured arranged the transaction, according to sources close to the deal.
Located at 5825 Oberlin Drive in western Sorrento Mesa, a neighborhood about 20 minutes northwest of downtown San Diego, the office property sits in the heart of the city’s life sciences and tech incubator portal.
Businesses operating within the Sorrento Mesa valley include Qualcoom, Texas Instruments, T-Mobile and Longfellow Real Estate Partners. The sprawling campus-neighborhood of University City — which sits adjacent to Sorrento Mesa — is home to the University of California, San Diego, numerous schools, parks, golf courses, office buildings and the UTC Westfield Mall.
“Its location is next to a strong population base with good retail and good access to freeways,” said David Perlman, managing director and head of the New York office for Thorofare Capital. “The Oberlin Drive corridor is filled with life sciences tenants.”
The building currently boasts an interior courtyard that tenants can access for outdoor meetings as well as dedicated exterior entrances. The plan is to convert the entire building to life sciences tenants, save for a single office tenant, per the terms of the deal.
“Rents are significantly higher for life sciences and demand is higher. It just makes sense to convert it,” Perlman added.
This is the first life sciences deal closed by King Street Properties in Southern California. The firm has previously partnered with Brookfield Asset Management on deals in Northern California and parts of the east coast as part of their joint venture investment vehicle.
Brian Pascus can be reached at bpascus@commercialobserver.com.
