GlobeSt.com reported in January that Sobrato Development Cos. was under contract to acquire the property for a price believed to be in the upper $60-million range. It was not immediately clear what killed that deal.

McCarthy Ranch generated 18 solid offers. In explaining the interest in the asset, Federle says there has been an enormous population explosion in the region over the past several years, and much of it has been thanks to well-educated foreigners from Europe and the Middle East who are making good money. Around McCarthy Ranch, annual household income is in the $130,000 range, he says. The other big piece of the puzzle is that some 265 million sf of R&D office and industrial space is located within 10 miles of McCarthy Ranch Marketplace and most big parks don't have food zoning, says Federle.

"So all those people with lots of disposable income stream out of these parks into four or five different centers; the flow is so big that companies have staggered lunch hours to accommodate the demand," he says. "McCarthy gets a huge flow of those folks for four hours every day, and when I say huge I'm talking 25,000 people."

Office Max has announced it will close its 24,000-sf store at McCarthy, though it is committed to leasing the location for the next four or five years. Federle says that because of when the property was built there are box tenants paying $14 to $15 per sf while the market average is closer to $28, depending on the size of the box, and the high end is $36 per sf. "I don't think [the new owner] will hit those numbers, but the rents [at McCarthy Ranch Marketplace Phase I] are ridiculously low compared to market," said Federle in January.