“The newly renovated buildings will offer suites as small as 36,000 square feet,” says Irwin. “We can expand the 2055 building or construct a third building in approximately 12 months, offering manufacturing, distribution or R&D tenants space at the campus in excess of 450,000 square feet.”

We spoke with Irwin about how common it is for a developer to repurchase a property it had previously owned or built and why MDC repurchased this one.

GlobeSt.com: Have you ever before purchased a property that you had previously owned?

Irwin: This is our first acquisition of a previously developed building. We have looked at other buildings in the past and had actually gone down the road on negotiations to purchase other buildings we had developed in the past. This was the first time it worked out for us.

GlobeSt.com: Is this practice common or rare among developers? Why?

Irwin: Rare. Since we're a smaller development shop and locally focused on specifically San Diego, we do look outside the region every now and then, keep an eye on all projects. Larger or fee developers who will go in and move on a space and try to do as much volume as possible don't typically reacquire sites for development purposes. We straddle the line between developer and investor.

GlobeSt.com: What about a property had previously owned would make you want to repurchase it?

Irwin: Overall, the industrial market is tight, and we had a focus on R&D corporate headquarters and industrial in San Diego. We were looking from top to bottom for opportunities and saw the potential for quality vacant space in the market to meet the demand that is there. We liked the site a lot; it was Mike Murphy's first development in San Diego, and it sits up high in the Otay submarket; it's a commanding presence. It's close to the port of entry, so for companies that are shipping product north across the border and then storing it in the Otay market, it's a great location right on the freeway. You don't need to take side roads to get to the location. We like larger projects that have scale to them, no infill sites. This has big scale to it; it's nice and big and landscaped. It's set back and has a corporate environment. There are great features to the buildings, good loading, good power and clear heights. And there's a 5-acre site on the project on which we can build a building as well, which plays to our development skills. We bought it from Panasonic and are leasing back just under half the project to them, so a good-credit tenant remains in the project.

GlobeSt.com: What else should our readers know about this investment?

Irwin: We're going to be spending a lot of money on rehabbing it. It was developed by Sanyo for Panasonic 30 years ago. If we're buying existing product, we want to create a very corporate, high-end environment. We don't want to spend a lot and have to charge high rent. There's a balance there. Also, within San Diego, we will have 300,000 available in this project—there's nothing that large available in San Diego outside of factories.

SAN DIEGO—It's rather uncommon for a developer to buy an asset back decades after building it, but it worked for Murphy Development Co.'s repurchase of San Diego Business Park, for which the company will invest $15 million in upgrades, SVP and director of marketing Andy Irwin tells GlobeSt.com. MDC recently purchased the 542,197-square-foot, two-building office/industrial campus on Otay Mesa from Panasonic Corporation of North America, a property that the company built in 1986 for Sanyo, which was acquired by Panasonic in 2010. In addition to the $28-million purchase price, MDC plans to invest $15 million in upgrades.

Brent Bohlken and Bryan Teel of NGKF represented the seller in the transaction, while and Murphy represented itself. The property, which will be rechristened the Campus at San Diego Business Park, is located at 2001 and 2055 Sanyo Ave.

The buildings are strategically located contiguous to the SR 11 and within a few hundred feet of SR 905, providing excellent freeway identity and access. Panasonic will lease approximately 70% of the 329,000-square-foot 2001 Sanyo Ave. building after MDC completes 42,000 square feet of new improvements. The remaining 94,000 square feet of class-A industrial space in the 2001 building and 209,700 square-feet in the 2055 building will be marketed for lease. The Campus also includes a 7-acre, fully entitled parcel of land, which MDC plans to develop into either a 150,000-square-foot freestanding building or to expand the 2055 building into a 350,000-square-foot building.