Irvine Company to Build Largest Life Sciences Campus in OC

The Irvine Company wants to build the largest life science office complex in Orange County in Irvine, next to the campus of UC Irvine.

The Newport Beach-based company is planning four office and research buildings encompassing 532K SF at its UCI Research Park at 100 Innovation Drive, according to a report in the Orange County Business Journal.

Irvine is calling the cluster of four-story buildings, each 128K SF, Academy Point. Each building will feature lab-ready offices for medical, healthcare and biotech tenants at the new campus, which will be built on site in proximity to MacArthur Boulevard and University Drive.

Academy Point will be positioned as having exclusive access to UC Irvine, leading research hospitals, life science incubators and medical device companies in Orange County, according to marketing materials.

Irvine Company spent $100M to upgrade its 185-acre UCI Research Park in 2018.

The developer hasn’t set a timeline for construction and may want to prelease some of the space before beginning construction, according to the Journal.

The reluctance to start new construction of office space in Orange County is understandable considering the slowdown in leasing activity recorded in the third quarter.

Orange County’s Q3 leasing volume declined 15% quarter-over-quarter in Q3, according to JLL’s office market report.

Total vacancy began to increase again after three consecutive quarters of decline, predominantly driven by the commodity Class A segment, with overall vacancy reaching 21.1%, JLL reported.

With another 409,000 SF hitting the market in Q3, total sublease availability in Orange County reached 3.7M SF, a new historical high that surpassed the watermark set during the global fiscal crisis in 2008 by 14%.

More than 810K SF of sublease space has been added in Orange County the past two quarters, of which 56% came from mortgage and finance companies in response to the interest rate hikes since late March, the brokerage said.

“The Orange County office market will remain tenant favorable given rising sublease availabilities combined with 660,000 SF of new office product expected to be delivered by the end of 2022,” JLL’s report said.

A positive note was sounded in the Airport Area submarket of Orange County, where net absorption remained positive during the quarter, as Anduril took occupancy at The Press, their new 640K SF headquarters building in Costa Mesa.

“Many technology companies continued to express strong interest in creative office space in South County,” JLL said.