Another Loss Added to List of Orange County Office Sales
By Greg Cornfield February 21, 2024 4:05 pm
reprints
Another office bites the dust, proverbially speaking.
TPG Angelo Gordon and Ocean West Capital Partners have sold a nine-story office building in Orange County, Calif., for $31 million, or $146 per square foot, property records show. That’s 42.5 percent less than the $54 million it traded for in April 2019. Ocean West recently completed a $2.5 million renovation on the property, according to its website.
Records show New American Funding acquired the 212,000-square-foot office at 1 MacArthur Place in Santa Ana, about a quarter-mile north of a group of other offices along Hutton Centre Drive that sold for measurable losses in separate transactions over the past year.
Neither the buyer nor the sellers responded to requests for comment on the deal.
There are no office projects currently under construction in Orange County, according to CBRE (CBRE)’s fourth-quarter market report. Other than the COVID-constrained 2020, last year was the only time in more than a decade that Orange County saw negative annual office absorption at 1.7 million square feet.
“The lack of leases signed over 10,000 square feet contributed heavily as they did not keep pace with the rate of large spaces returned to landlords,” CBRE’s report reads.
El Segundo-based Ocean West Capital and TPG Angelo Gordon previously sold the nine-story 2 MacArthur building next door for $98 million in 2021 after acquiring it for $83 million in 2019 in what has become an outlier post-pandemic deal for Southern California. The premium sale price is largely because the State of California occupies much of that property on a lease that runs through 2039, per the Orange County Business Journal.
Gregory Cornfield can be reached at gcornfield@commercialobserver.com.
