Dealmaker: Regent Properties Acquires San Diego Office Portfolio for $420M
Regent Properties, Los Angeles, acquired four high-rise San Diego office buildings for $420 million.
EMMES Group of Cos., Irvine, Calif., sold 1 Columbia Place, 701 B Street, 2 Columbia Place and 707 Broadway in downtown San Diego. The assets total 1.5 million square feet, or nearly 16 percent of all Class A and B office inventory in downtown San Diego. The transaction price equaled $281 per square foot.
The acquisition represented Regent’s first investment via its Regent Opportunity Fund V.
“As an emerging gateway city, San Diego has the strongest relative value compared to any other tier-one location on the West Coast,” said Sam Kraus, Regent Properties’ EVP and Head of Acquisitions. “The opportunity to acquire these particular assets to improve, lease-up and stabilize them was especially compelling given our conviction in the long-term growth prospects of downtown San Diego.”
A previous owner extensively renovated the portfolio’s common areas, including upgraded lobbies and outdoor amenities. Regent said it plans to add additional hospitality-oriented improvements including new fitness and conference centers and gathering places such as outdoor terraces and wine lounges.
San Diego’s coastal location, strong public transit connectivity and quality of life has attracted several new business tenants across various sectors, especially in life sciences. CoreLogic, Irvine, Calif., recently forecast San Diego home prices could increase by more than 8 percent this year, among the highest rates in the nation, with income growth for highly skilled positions a leading factor.
Regent Properties CEO Eric Fleiss said the firm would like to acquire high-quality office projects across the Sunbelt. “We are seeking to purchase over $2 billion of assets over the next 24 months,” he said.