Distressed 827,000-SF Complex Sells for $213M

COSTA MESA, CA-The Irvine Co. has acquired the MPG Office Trust’s four-building, 827,000-square-foot Pacific Arts Plaza office complex out of receivership. Price was undisclosed, but sources peg it at $213 million.

Pacific Arts Plaza comprises four office buildings and four freestanding restaurants including Mastro’s Steakhouse, TGI Fridays and Jerry’s Deli. Its office towers include addresses at 611 Anton Blvd., 675 Anton Blvd., 3200 Park Center and 3200 Bristol St.

Pacific Arts Plaza was in receivership “pursuant to our written agreement with the respective special servicer,” according to MPG Office Trust’s third-quarter financial report for the period ending Sept. 30. The receiver for the complex was Michael Prabhu, director of property management for the Southwest region of Jones Lang LaSalle.

The acquisition of Pacific Arts Plaza expands the Newport Beach-based Irvine Co.’s holdings in the Orange County Theater and Arts District, where the complex gives the new owner a 10% market share, according to a statement from Doug Holte, president of Irvine Co. Office Properties. With the addition of Pacific Arts Plaza, the company “now has a meaningful presence of all four class-A office markets in Orange County including the Theater and Arts District, Newport Center, the Airport Area and Irvine Spectrum,” Holte said.

The four office buildings at Pacific Arts Plaza surround a 1.6-acre art sculpture garden titled “The California Scenario,” designed by artist Isamu Noguchi. The Irvine Co. said it plans immediate improvements of on-site amenities, common areas, operating systems and outdoor areas at the complex.

MPG stopped making mortgage payments on the complex in September 2009, according to the REIT’s third-quarter financial report for the period ending Sept. 30. Pacific Arts Plaza is one of a number of properties that Los Angeles-based MPG has allowed to go into default in its quest to get out from under a huge debt load that the company, then named Maguire Properties, took on when it acquired a portfolio of former Equity Office Properties buildings from Blackstone in 2007. Another MPG property in receivership is 2600 Michelson Dr., a 16-story, 307,662-square-foot office tower on which MPG stopped making mortgage payments in August 2009.