Office, Industrial Buyers Invest $35M

In the $12.9 million off-market deal, Phil Cohen of the Irvine office of Lee & Associates reports that the Jack Markovitz Trust bought a 44,123-sf office building called Red Hill Corporate Plaza at 15501 Red Hill Ave. in Tustin. Cohen, who represented both the buyer and the seller, John R. Saunders of Red Hill LLC, reports that the deal traded at a 7% cap rate and that the buyer acquired the property in a 1031 exchange for cash flow purposes.

"In today's economy, this was a good investment for the buyer because of the good cap rate, and a very attractive loan that was assumed as part of the transaction," Cohen notes. The 44,123-sf office building was built in 1984 and is the headquarters of Oncotech, a company that provides molecular oncology testing services to more than 1,000 hospitals throughout the US and Europe. The company also assists doctors in the care and management of their cancer patients.

[IMGCAP(2)]In another transaction also on Red Hill Avenue, senior vice president Mike Hartel of the Irvine office of Voit Commercial Brokerage reports that a group of private investors called 15771 Red Hill LLC has acquired a 79,756-sf industrial property at 15771 Red Hill Ave. from SK Red Hill Properties LLC for $12 million. Hartel, who represented the buyer, says that "a compelling financing package" was one of the reasons that the deal went through despite the uncertain capital markets environment. Thanks to the investor's close relationship with his lender, Bank of America, and "the hard work of its representatives, Jason Pak and Melanie Smith," Hartel says, "the lender was able to provide a compelling financing package to motivate the buyer to continue with this transaction."

Hartel also credits the quality of the real estate and the efforts of others involved in the deal with bringing the transaction to fruition. He cites "the hard work of the representatives from CB Richard Ellis, Bank of America and LandAmerica Title/Escrow, as well as extensive cooperation from both the buyer and the seller." The seller was represented by Gregg Haley and Kelly Kayl of CB Richard Ellis.

The 79,756-sf building is situated on six acres of land and features 36,000 sf of new office space. The property is 50% leased by a single tenant, Cookie Lee, which sells jewelry directly to customers through a network of independent consultants.

In the third transaction, the $10 million portfolio included three medical office buildings totaling 46,441 sf, according to John Bosko and Bob Bush of NAI Capital's Newport Beach office, who represented the buyer, KAMF Tustin LLC. The first property is a 14,023-sf assset known as the Tustin Medical Arts building, at 13422 Newport Ave. Bosko and Bush also represented the seller, Tustin Medical Arts.

Another 20,450 sf of the portfolio included buildings at 13362 and 13372 Newport Ave. The seller, Selcasnan Limited Partnership, was represented by Gary Stache and Pat Scruggs of CBRE.

The third part of the package was an 11,968-sf building on 45,302 sf of land at 1101 Bryan Ave. The seller was Bryan Medical LLC, which represented itself.

Bosko and Bush will also be the leasing brokers for two units of approximately 3,000 sf each in the 1101 Bryan Ave. building. Bosko notes that the new owner will be implementing a new landscape plan and will be completing substantial tenant improvements at the vacant suites.