Orange County, Calif. Transit Authority Pays $55M for New HQ
Adding tenant improvements and associated operational costs, the transit authority expects to spend a total $205M on the building over the next 30 years.
By Nick Trombola October 31, 2024 8:07 pm
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The Orange County Transportation Authority has spent $54.5 million on a new headquarters office in Southern California in a deal that it says will ultimately save taxpayer dollars.
The OCTA closed its deal earlier this week with seller The Muller Company for 2677 North Main Street, a 220,500-square-foot office building in Santa Ana. Current tenants there include insurance company Assurant and law firm LaFollette Johnson DeHaas Fesler & Ames. CBRE represented the OCTA in the deal. The Orange County Business Journal first reported the news.
The OCTA’s board of directors approved the purchase in August after having considered the move for two years. After tallying the purchase price, tenant improvements and associated operational costs, the transit authority said it expects to spend a total $204.6 million on the building over the next 30 years.
That made the project more appealing when compared to the $255 million that OCTA said it would pay in comparable leasing costs over the same period. The transit authority has leased its current headquarters at 550 South Main Street in the City of Orange, less than a mile from its new building, for more than 30 years.
“The decision to acquire a permanent headquarters is a significant milestone for OCTA,” Tam T. Nguyen, OCTA Board Chair, said. “This purchase not only ensures operational efficiency but also represents a long-term financial advantage for our organization and most importantly, the people in Orange County we serve.”
The transit authority said it expects to move operations to the new building within the next three years and that many of the building’s current tenants will remain during that time.
The OCTA’s purchase was equal to about $247 per square foot. Other recent Orange County office deals include the five-building,185,180-square-foot Tustin Financial Plaza in Tustin that sold for $27.5 million, or $148.5 per-square-foot earlier this month, and a 157,455-square-foot building in Irvine that sold for $40.6 million, or about $258 per-square-foot.
Nick Trombola can be reached at ntrombola@commercialobserver.com.
