Real Estate Southern California: Spec Office Development Is Back in Gear

Cruzan’s “make” office project at 5600 Avenida Encinas in Carlsbad, CA, was part spec development and part repurposing of an old warehouse into creative office.

After a roughly eight-year hiatus during and after the Great Recession, speculative office development is finally returning to the Southern California marketplace. While much of the construction taking place can be classified as redevelopment or adaptive reuse due to land constraints in the region, the fact that spec development is happening at all is a testament to the national and local economy and the industry’s confidence in Southern California as an attractive market for jobs. Real Estate Forum spoke with several office-development experts in Los Angeles, Orange County, San Diego and the Inland Empire to get their take on this growing trend, why now is the right time for it, the type of development taking place and where, and where they see the trend heading in the future.

Today’s spec-office buildings naturally feature the modern amenities that most companies are seeking, but developers are getting creative in providing these features in unique spaces with a sense of place. “We’re in various stages of planning for campus and high-rise projects with a focus on sleek, modern architecture and coastal-California-lifestyle amenities,” Lauren Kelly, SVP and chief marketing officer for the Irvine Co., tells Forum. “Our ‘Next Gen’ campus office plans in Irvine, for example, will include floor-to-ceiling glass and aluminum curtain walls for superior natural light and energy efficiency; advanced infrastructure for technology; fitness and wellness centers offering indoor and outdoor activities, such as yoga and bike-sharing programs; and the Commons, a large, open-air space at the heart of each campus featuring Wi-Fi-enabled outdoor living rooms, sun decks and al fresco dining. Our new high-rises will also incorporate these lifestyle experiences into what we term a ‘vertical campus.’ “