Elements at Wateridge Parallel Capital Partners Matt Root office joint venture Equity Group Investments Beacon Capital Partners C-III Realty repositioning GlobeSt.com: Can you discuss the 2014 joint-venture acquisition of this property? Root: Equity Office Properties 
GlobeSt.com: How did you decide on the new name? Root: GlobeSt.com: What did the renovation entail? Root: A key component of our investment strategy was to reposition the office campus with base-building and common-area upgrades and renovations to tenant spaces. The goal was to enhance the experience of our tenants by refreshing and improving the aesthetics and increase the energy efficiency of the buildings. Our comprehensive facelift included aesthetics that were new, clean and modern: exterior and interior painting, fountain renovations, landscaping, LED lighting and substantial upgrades to existing lobbies, restrooms and corridors. New outdoor collaboration areas were created. Fresh exterior signage, featuring a new logo, links the campus together. Creative spec suites were designed and built to include work environments full of visual detail with extended views throughout the workplace—utilizing more natural materials and elements such as open kitchens, floor-to-ceiling glass and polished-concrete floors.
GlobeSt.com: What sorts of tenants were you targeting? Root: Sorrento Mesa is the technology hub of San Diego—where the best and brightest workers innovate and create cutting-edge technologies. Our focus has been sourcing the highest-caliber tenants in the fields of telecommunications, software, wireless applications and biotechnology research. The efforts of our excellent leasing team—Mike Hoeck, Ryan Egli and Matt Carlson of CBRE—have culminated in the three recent leases executed totaling more than 40,000 square feet. GlobeSt.com: What were the challenges/opportunities you have/had in leasing this building? Root: The immediate challenge in Sorrento Mesa has been Qualcomm—the third-largest chip company in the world (by revenue)—occupying more than 4.6 million square feet in Sorrento Mesa (93% of their San Diego real estate). Qualcomm is in the midst of its “pivot plan” as it navigates the next wave of Internet connectivity that is omnipresent in our modern society and has recently vacated 119,000 square feet in Sorrento Mesa at Sorrento Towers. The silver lining is that intellectual capital—particularly the highly skilled engineers that Qualcomm has laid off—is quickly being hired by other technology companies seeking a presence in Sorrento Mesa. Google and Verizon are two great examples. Google recently signed a lease for 60,000 square feet, and Verizon signed for 110,000 square feet in Sorrento Mesa. So, the Qualcomm effect appears to be more muted than most market participants anticipated. GlobeSt.com: What is the appeal of the Sorrento Mesa submarket? Root: Sorrento Mesa is a thriving technology-driven submarket led by a high concentration of diverse, technology-oriented tenants that include Qualcomm, Sony, Motorola Mobility, Samsung, Google and Verizon. The historical clustering of these large technology firms has provided Sorrento Mesa with long-term strength and stability. Sorrento Mesa is one of the region's most sought-after institutional-office markets, centrally located between San Diego's elite central submarket cluster: Del Mar Heights to the north, University Towne Center to the south and Torrey Pines to the west. Elements at Wateridge Parallel Capital Partners Matt Root office joint venture Equity Group Investments Beacon Capital Partners C-III Realty repositioning GlobeSt.com: Can you discuss the 2014 joint-venture acquisition of this property? Root: Equity Office Properties GlobeSt.com: How did you decide on the new name? Root: GlobeSt.com: What did the renovation entail? Root: A key component of our investment strategy was to reposition the office campus with base-building and common-area upgrades and renovations to tenant spaces. The goal was to enhance the experience of our tenants by refreshing and improving the aesthetics and increase the energy efficiency of the buildings. Our comprehensive facelift included aesthetics that were new, clean and modern: exterior and interior painting, fountain renovations, landscaping, LED lighting and substantial upgrades to existing lobbies, restrooms and corridors. New outdoor collaboration areas were created. Fresh exterior signage, featuring a new logo, links the campus together. Creative spec suites were designed and built to include work environments full of visual detail with extended views throughout the workplace—utilizing more natural materials and elements such as open kitchens, floor-to-ceiling glass and polished-concrete floors.
GlobeSt.com: What sorts of tenants were you targeting? Root: Sorrento Mesa is the technology hub of San Diego—where the best and brightest workers innovate and create cutting-edge technologies. Our focus has been sourcing the highest-caliber tenants in the fields of telecommunications, software, wireless applications and biotechnology research. The efforts of our excellent leasing team—Mike Hoeck, Ryan Egli and Matt Carlson of CBRE—have culminated in the three recent leases executed totaling more than 40,000 square feet. GlobeSt.com: What were the challenges/opportunities you have/had in leasing this building? Root: The immediate challenge in Sorrento Mesa has been Qualcomm—the third-largest chip company in the world (by revenue)—occupying more than 4.6 million square feet in Sorrento Mesa (93% of their San Diego real estate). Qualcomm is in the midst of its “pivot plan” as it navigates the next wave of Internet connectivity that is omnipresent in our modern society and has recently vacated 119,000 square feet in Sorrento Mesa at Sorrento Towers. The silver lining is that intellectual capital—particularly the highly skilled engineers that Qualcomm has laid off—is quickly being hired by other technology companies seeking a presence in Sorrento Mesa. NOT FOR REPRINT
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