LOS ANGELES — Jan. 14, 2014 – CBRE announced the sale of Tustin Centre I and II, located at 1551 and 1525 N. Tustin Avenue in Santa Ana. CBRE Strategic Partners U.S. Value 6, a fund sponsored by CBRE Global Investors, has acquired the two Class A, Energy Star office buildings, 196,458 and 82,042 square feet, respectively. CBRE’s Capital Market experts, Bob Smith, Executive Vice President; Paul Jones, First Vice President; Kevin Shannon, Vice Chairman; and Ken White, Senior Vice President; represented the seller in the transaction.
Tustin Centre I is a multi-tenant, 10-story office tower sitting on 2.57 acres of land. The tower was approximately 80 percent leased at the time of sale to a mix of corporate users across a range of industries. The building, which features granite and marble lobbies, offers high visibility along the Costa Mesa (SR-55) Freeway. It’s also surrounded by numerous amenities within walking distance.
“Tustin Centre I is considered one of the highest quality high-rise office buildings in Central Orange County,” Mr. Smith said. “It’s valued well below estimated replacement cost of approximately $425 per square foot.”
Tustin Centre II is a single-tenant, four-story office building developed in 2010 – one of the newest office buildings in Orange County. It was also one of the first LEED for Core and Shell Gold office buildings in Southern California. It is fully occupied by Regional Center of Orange County through November 2020.
“Tustin Centre II is a stable, long-term investment with 100 percent occupancy. This is an investment opportunity that provides a strong, secure, and growing income stream,” Mr. Jones said. “With barriers to new office development in the area, this new LEED development, with lush landscaping, modern designs, and a central location within Orange County will benefit from upward pressure on Class A rental rates.”
The CBRE Strategic Partners U.S. Value 6 fund team is planning to implement a capital campaign to enhance the existing amenities package to its signature 5-Star Worldwide standards, make select cosmetic improvements to common areas, and obtain LEED certification for Tustin I. Additionally they will engage a leasing team to market the new 5-Star Worldwide amenities and new ownership as well as promoting a “spec suite” program and a building signage opportunity to address vacancies and lease expiration risk.
“Orange County is one of our top-ranked office markets in the nation, and this acquisition is an ideal investment in this market for our fund,” said Vance Maddocks, President of CBRE Strategic Partners U.S. “With our proven operating strategies, we believe we can add value for both tenants and our investors.”
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2012 revenue). The Company has approximately 37,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through more than 300 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.
About CBRE Global Investors
CBRE Global Investors is a global real estate investment management firm with $87.6 billion in assets under management* as of September 30, 2013. The firm sponsors investment programs across the risk/return spectrum for investors worldwide.
CBRE Global Investors is an independently operated affiliate of CBRE Group, Inc. (NYSE:CBG). It harnesses the research, investment sourcing and other resources of the world’s premier, full-service commercial real estate services and investment company for the benefit of its investors. CBRE Group, Inc. has approximately 37,000 employees in more than 300 offices (excluding affiliates) worldwide. For more information about CBRE Global Investors, please visit www.cbreglobalinvestors.com.
*Assets under management (AUM) refers to fair market value of real estate-related assets with respect to which CBRE Global Investors provides, on a global basis, oversight, investment management services and other advice, and which generally consist of properties and real estate-related loans; securities portfolios; and investments in operating companies, joint ventures and in private real estate funds under its fund of funds program. This AUM is intended principally to reflect the extent of CBRE Global Investors’ presence in the global real estate market, and its calculation of AUM may differ from the calculations of other asset managers.