Griffin Nabs Irvine Business Center HQ

IRVINE, CA-GlobeSt.com has learned exclusively that Griffin Capital Corp. has purchased a recently constructed, 82,645-square-foot, class-A creative-office building on behalf of Griffin Capital Essential Asset REIT Inc. The property, located in the Irvine Business Complex adjacent to the master-planned Tustin Legacy development, was acquired from a partnership between Penwood Real Estate Investment Management and Shubin Nadal Associates for $27.2 million.

The property was developed as a build-to-suit global headquarters facility for Fox Head Inc., which fully leases the space through December 2027. Fox Head is a motocross-focused, action-sports accessories and apparel company established in 1974.

“This marks our first acquisition in the dynamic Orange County MSA, which ranks as the second most-densely populated county in California,” says Michael Escalante, Griffin Capital's chief investment officer. “Furthermore, the in-fill location amidst the heart of the Irvine Business Complex creates a meaningful barrier to entry for any new creative-office construction which would most likely only be achieved through the redevelopment of an existing asset, both an expensive and time-consuming proposition.”

The building was designed by Clive Wilkinson Architects, the firm responsible for such projects as the Google and Disney Store headquarters. The property enjoys ready access to the area's main transportation arteries including the 55 and 405 freeways and John Wayne
International Airport.

According to Louis Sohn, SVP of acquisitions for Griffin Capital, “We are pleased to acquire this unique business essential asset and believe that demand for creative-office space will become more pronounced in coming years. Given the current lack of creative-office space in the market, the tenant was motivated to secure long-term tenancy at the location as manifested in an original lease term of 15 years. The steady net rental revenue stream with 2.5% average annual increases, secured by a growing credit, will continue to inure to the benefit of the REIT for many years to come.”

The purchase represents the second headquarters building the REIT has acquired this month on which GlobeSt.com has reported. Griffin Capital bought the Verizon Wireless headquarters in Warren, NJ, for $40 million, GlobeSt.com reported exclusively in early October.