IRVINE, CA-Hines Global REIT has acquired the 17600 Gillette office building from AJ Irvine Owner Corp. for $20.35 million, according to an announcement by the Houston-based REIT and its public filings. The property is a two-story, 98,925-square-foot office building that is 100% leased until March 2016 to Draft FCB Inc., a global advertising agency.
The lease status of the building and its location in the Orange County Airport Area office submarket were significant factors in Hines’ decision to acquire the property, according to Charles Hazen, president and CEO of Hines Global REIT, which is public and non-traded. According to Paul Twardowski, Hines partner and vice president who oversees the Orange County and San Diego markets, the acquisition “is an indication of our positive outlook in the long- term fundamentals of the local market.”
The seller was represented in the transaction by Jeff Cole and Ed Hernandez of Cushman & Wakefield. The 17600 Gillette is Hines’ seventh acquisition in Orange County over the last six years and “demonstrates the firm’s commitment to the area,” the company said in a prepared statement.
The Hines acquisition comes at a time of strong investor interest in well-leased and well-located office properties in Orange County despite the general weakness in the county’s office market. While some distressed properties have sold for steep discounts, well-leased and well-located properties are attracting higher prices than they would have a year or so ago, according to brokers following the market.
For example, Los Angeles-based Kilroy REIT is under contract to buy the 2211 Michelson Dr. office building for $103 million, according to a statement issued by the L.A.-based company.
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