Kirk Wright, CEO of the Garrett Group, points out that the Temecula-based company has also acquired a 114,000-sf building in the Silverhawk Business Park that PHS will lease as warehouse space while the new project is under construction. Besides developing and investing in the PHS project, Wright notes, the Garrett Group is developing other parcels adjacent to the new PHS headquarters.

The new 600,000-sf project also serves to keep a major employer within the Temecula city limits, notes Wright. He says that keeping PHS in the city was a primary aim of the project, which involved “working out some dynamic issues between multiple property owners, as well as PHS and the city.”

John Augustine, CFO of PHS, handled the negotiations for PHS. The hospital supply chain's goal was to keep its headquarters in the city because its employee base is here and the city offers a high quality of life, Augustine comments.

The decision to stay in Temecula involved “some pretty tough decisions to make in deciding not to relocate,” according to Jenise Luttgens, president of PHS. The new facility will consolidate PHS operations from several buildings into one main plant, Luttgens notes.

The four existing facilities that PHS operates in Temecula amount to about 800,000 sf with more than 1,300 employees. After consolidating, the company will still retain some of its operations in a facility located at the corner of Winchester and Diaz roads. PHS will continue to operate its other facilities located in Northern California, Arizona, Idaho and Colorado.

A combination of real estate brokerage offices assisted in the transactions, including Coldwell Banker Commercial, Almar Group, which represented the Garrett Group in the acquisition of the 32 acres; Golden Real Estate Investment, representing PHS' interest; and CBRE and CB Almar in the purchase of the 114,000-sf building by the Garrett Group that will be leased to PHS throughout the construction of the new facility.