Dealmaker: JLL Income Property Trust Acquires San Diego Medical Office Campus

JLL Income Property Trust, Chicago, acquired Genesee Plaza, a two-building medical office campus in San Diego’s University Town Center neighborhood.

The real estate investment trust paid $90 million for the Class A asset. The San Diego Business Journal reported Polidev Investments, San Francisco, purchased the property in 2014 for $72 million.

JLL subsidiary LaSalle Investment Management called the medical office sector a defensive, low beta real estate investment strategy for late cycle investing. “Medical office fundamentals remain strong as evidenced by low vacancy rates, healthy net absorption and the balanced introduction of new supply,” said LaSalle Head of U.S. Healthcare Real Estate Steve Bolen. “As healthcare delivery in the U.S. continues to transition to outpatient settings, Class A medical office buildings like Genesee Plaza are well positioned.”

The acquisition brings the firm’s medical office building transaction count to 93 buildings with an aggregate value exceeding $2.5 billion, Bolen noted.

Genesee Plaza is close to the University of California-San Diego and Scripps Hospital Campuses. The property’s coastal infill location has seen severe supply constraints with high barriers to entry from both geographic barriers and zoning restrictions.