Blackstone Pays $82M for MacArthur Towers

SANTA ANA, CA-GLL Real Estate Partners has sold 1 and 2 MacArthur Place, two class-A, mixed-use assets in the South Coast Metro submarket here for $82.5 million to Blackstone Group. GlobeSt.com was unable to determine before deadline Blackstone's plans for the property, but has learned that the property is 38% occupied between the two buildings.

Managing director Michael Zietsman and VP Baker Morphy in Jones Lang LaSalle's Capital Markets group led the team on the transaction. According to Zietsman, “Buyers were presented with an incredible opportunity to obtain large blocks of class-A office space. The Airport Area submarket has seen a significant increase in office leasing activity, which should result in heightened tenant interest and a significant value-add opportunity for Blackstone.

The office towers total 409,762 square feet. As part of the MacArthur Place campus, the properties are located on the same site as retail and residential properties and are also near the area's airport and highway system. Each building features nine stories and is LEED Gold certified.

As GlobeSt.com reported exclusively last week, the Orange County office market posted more than 1.175 million square feet of positive net absorption during fourth-quarter 2013, according to Voit Real Estate Services. The quarter marked the 7^th consecutive quarter of positive absorption and the third consecutive quarter of rising lease rates for the county.

The average asking full-service gross lease rate finished the fourth quarter at $1.93, an increase of 5 cents from 2012's average asking rates, Voit reports. The rise is further evidence of the sector's recovery.

Also, as GlobeSt.com reported exclusively in October 2013, office sale prices are soaring in all product classes and continue to rise at a rapid pace, according to JLL. With the county's largest sale of the year recently closing, the purchase of 2030 Main St. by a New York City-based real estate investment firm Praedium Group from an unnamed institutional advisor for $114 million, it's evident that sales prices have skyrocketed over the past year. At the time, Morphy told GlobeSt.com that most of the office trades in Orange County were occurring in South County, particularly in the Irvine Spectrum and Airport Area submarkets. “Deals are being transacted right now. Investors are optimistic about the market.”