SAN DIEGO-KBS Real Estate Investment Trust II of Newport Beach has acquired the 158,000-square-foot Horizon Tech Center, an REO property, for $40.5 million. The office campus in Scripps Ranch consists of three two-story buildings that are fully leased to Lockheed Martin.

Horizon Tech Center was newly constructed by Opus in 2009. The name of the REO seller was not disclosed, but sources indicate it was Bank of America.

Steve Rowland, senior director with Cushman & Wakefield’s capital markets group, notes that the class A campus sits on an elevated site with panoramic views and adjoins a six-acre city park with walking paths and trail access to Lake Miramar. Numerous retail and restaurant amenities are nearby. On site amenities include a full-service cafeteria, men’s/women’s locker facilities in each building and a parking ratio of 3.9 spaces per 1,000 square feet.

Rowland, who was part of a Cushman & Wakefield team representing the seller, comments that the deal illustrates how, “REITs are accelerating their acquisitions of high-end assets such as Horizon Tech Center, particularly when there is a stable rent roll." He adds, "The fact that this campus is brand new with a flexible design and occupied by an investment-grade tenant such as Lockheed Martin was a key draw." Institutional buyers "are more aggressive in 2010 for core-plus offerings, countering the dominance of private buyers in 2009," Rowland says.

KBS Real Estate Investment Trust II is a non-traded REIT. The company said in a public filing that it funded the purchase of Horizon Tech Center with proceeds from its ongoing initial public offering but may later place mortgage debt on the property.

According to Rowland, investors looking for immediate accretive returns in attractive metropolitan areas like San Diego are also focused on sustainable assets, especially when they are LEED-certified. Horizon Tech Center combines a Gold LEED Core & Shell designation along with best-of-class building amenities and a location in the heart of the I-15 Technology Corridor, he points out.

The Cushman & Wakefield team representing the seller included Rowland, Jeffrey Cole, Steve Rosetta, Ed Hernandez and Michael Roberts. Chris Wood of Voit Real Estate Services also consulted with ownership on the sale. There was no cooperating broker.