Tax Relief Company Signs Office Lease at Griffin Towers in Orange County
Blackstone unloaded the office earlier this year in one of 2023’s first major signs of sinking property values
By Nick Trombola November 14, 2023 2:22 pm
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A new tenant is moving into a 13-story office property in Orange County, Calif., that Blackstone (BX) ditched earlier this year for a big loss.
Optima Tax Relief signed a 38,090-square-foot, 40-month lease at Griffin Towers, a Santa Ana office park owned by a joint venture between Barker Pacific Group (BPG) and Kingsbarn Realty Capital. The landlords declined to disclose the value of the lease.
Optima will move into the space at 5 and 6 Hutton Centre Drive by the end of this year.
“We are encouraged to have this new leasing activity at the project, and it bodes well for companies returning to office after the pandemic,” BPG Managing Director Michael Barker said in a statement.
Built in 1987 and featuring 560,000 of rentable space, the Griffin Towers property is at the intersection of the 405 and 55 freeways just north of John Wayne Airport. Other major tenants at the towers include UKG, Michael Baker International, Ferry International, Psomas, HNTB and the Ayn Rand Institute.
Previous owner and real estate behemoth Blackstone sold the towers earlier this year for $82 million, or $146 per square foot for the complex. That figure is roughly 36 percent less than the $129 million that the company paid for the towers back in 2014. The ominous discount was one of the first major signs of the steep decline in office property values around Southern California.
“While there are market challenges for owners of office buildings, we believe in the future of high-quality office environments with great locations and robust amenities, which Griffin Towers offers its tenants,” BPG’s Mark Handin said in a statement at the time.
Office leasing activity in Orange County showed signs of improvement in the third quarter after a dismal couple of years, though it still lags behind pre-pandemic levels due to macroeconomic concerns, higher inflation and hiring slowdowns, according to Savills.
Nick Trombola can be reached at NTrombola@commercialobserver.com.
