Heller plans to substantially renovate the existing building and develop another 30,000-sf office building on the excess land. The completed project will be known as Iron Point Park.
Tom Walcott and Kris Reilly of Grubb & Ellis' Sacramento office represented the buyer in the transaction and have been maintained to continue working on the project. Dan Chamberlain, Jon Walker, Jon Larson and Robert O'Neill of Grubb & Ellis' Newport Beach office represented the seller, Newport Capital Advisors.
Walcott tells GlobeSt.com that the current plan is to either lease up and sell the existing building to an investor following the renovation, or to sell the building to an owner-user. As for the new development, what happens with the existing building will be a deciding factor.
"If he finds a good user for the existing building, his basis in the excess land would be very little, which could mean he develops the new building on a speculative basis," says Walcott. "If the existing building is slow to lease up or sell, then he might wait for a build-to-suit opportunity."
The property is one of 44 such assets in California that Newport Capital Advisors acquired in bulk from State Farm properties late last year. The Irvine, CA-based company hired Grubb & Ellis to flip them individually or in small bundles to investors and owner-users.
Newport Capital Advisors' acquisition consisted of 35 single- and two-story buildings ranging in size from 8,500 sf to 30,000 sf and nine parcels of vacant land (1.5- to 4-acre parcels) totaling about 25 acres. Newport values the portfolio at $100 million. The properties are spread evenly between Northern California to San Diego, and the existing structures total 545,000 sf. O'Neill was not available Thursday to provide an update on how many have been sold. In December, he told GlobeSt.com the properties were to be completely sold off by the end of 2004.
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