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SANTA ANA, CA-The Tishman Speyer Office Fund has acquired the 3 Imperial Promenade building in the South Coast Metro district from AEW Capital Management for $83 million. The property is a 246,763-sf, 11-story class A office building that attracted multiple offers in hotly contested bidding, according to Michael Kane of the Newport Beach office of CB Richard Ellis, who was part of a CBRE team including Robert Smith, Karen Scholte, Dean Chandler and Mark Friend of the company’s Newport Beach and Anaheim offices that marketed the property for AEW.

Kane tells GlobeSt.com that the strong investor interest in the building and the price per sf are signs of “where Orange County is going with regard to pricing” of large, high-quality office assets. The deal is one of the largest single-asset sales to close lately in Orange County, where a number of big office portfolio deals have been in the news.

“Larger class A buildings are commanding prices into the range of $400 per sf, which is pushing a larger number of deals into the $100-million range,” Kane comments. He says that the 3 Imperial Promenade property represents “a very high quality building and a great opportunity for the buyer.”

Kane notes that the property includes a large parking structure and is known for its distinctive water garden and waterfalls at the front of the building. The asset drew bids from a broad spectrum of prospective buyers in multiple rounds of bidding, he adds.

According to a filing by Tishman Speyer Office Fund, which is publicly listed on the Australian Stock Exchange, the 3 Imperial Building is 76% leased, offering the potential for significant upside in filling the vacancy and raising rents on lease rollovers. The fund’s filing notes that the property, which sold for below replacement cost, was built in 1991 and is situated in a premier location within the 65-acre MacArthur Place mixed-use development.

MacArthur Place, which is close to the John Wayne Airport and the South Coast Plaza shopping district. The development features more than 1.2 million sf of office space, luxury residential projects, a hotel and 20,000 sf of retail and restaurant space.

Tishman Speyer’s public filing says that the fund purchased the 3 Imperial building as an exchange property for the planned sale of a 474,000-sf class B office building called Plaza East in Milwaukee. The company bought the building in 2004 and “has exhausted upside in the asset through recent leasing success,” the filing says.

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