120,000 SF of Office Leases Keep Market Moving

SANTA ANA, CA-An 85,339-square foot office lease here, plus a number of smaller deals signed recently in the county, have continued the momentum that was reported in recent market surveys, albeit the OC office market remains "one of the country's most competitive," according to one of the landlords in the deals. The reference to competition came from Los Angeles-based Highridge Partners, which signed Edison Mission Energy to a 10-year lease for 85,339 square feet at 3 MacArthur Place, a 246,819-square-foot office tower that Highridge bought for $31 million last year.

The lease with Edison illustrated the "positive momentum" that CB Richard Ellis described in Orange County's office market in CBRE's second-quarter office market survey last month. That report cited declining rents as one of the factors driving deals, and said, "Many tenants are starting to move forward with expansion plans as the time is right to take advantage of the competitive lease rates and concessions being offered by landlords."

The lease by Edison, which is an owner and operator of power production plants, was one of two significant deals that have boosted occupancy to 85% at 3 MacArthur. The other was a seven-year lease renewal with T-Mobile for 20,377 square feet.

Jack Mahoney, executive vice president of Highridge Partners, observed that, “Companies seeking office space in Orange County have an abundance of options. Edison Mission, which is slated to move from its existing headquarters in Irvine in January, was represented by Al Masters and Michael Streff of RealTech. Highridge was represented by Andrew White, Dean Chandler and Mark Friend of CBRE.

Among the other office leases signed recently was a commitment by Primary Residential Mortgage Inc. for 15,000 square feet at 2100 Main St. in Irvine. Building owner Morgenstern Property Co. was represented by Oliver Fleener and Tim Joyce of Grubb & Ellis’ Newport Beach office; the tenant was represented by Tom van Betten of Cassidy Turley|BRE Commercial.

Wilson Morgan LLP signed an eight-year lease for 8,363 square feet at 1920 Main St. in Irvine with property owner Shorenstein Realty Services. Wilson Morgan was represented by Jack McNutt of Grubb & Ellis’ Newport Beach office, and Shorenstein by Rich Essen of Orion Partners Inc.