A three-building office complex in the heart of San Diego’s Mission Valley submarket is on the market with an asking price of $18.7 million, or approximately $236 per square foot. According to an offering memorandum from listing agents at Cushman & Wakefield, the property is 92 percent leased and offers 79,115 square feet of rentable space.
Referred to as Center Point, the office complex is located at 3110-3160 Camino del Rio South on approximately 4.05 acres of land. The two-story buildings were first built in 1982 and have since received upgrades and renovations to all office suites.
According to public records, the property is currently owned by an entity associated with Long Beach-based City Group, which acquired it in 2001 for an undisclosed amount.
Currently, Center Point is occupied by multiple tenants, including the Department of Veteran Affairs which has leased space there since 2011. According to the offering memorandum, the DVA’s in-place rent is 26 percent below current market rent, providing a sizable near-term increase in cash flow.
While almost fully leased, the offering memorandum also shows that 88.2 percent of the properties’ rentable space is set to expire within three years.
“With current approximately 18 percent below achievable market rents, Center Point provides a unique balance of stable income and the ability to significantly enhance value through market rate renewals and the lease-up of the existing 6,365 square feet of vacancy,” the offering memorandum states.
Located in Mission Valley, Center Point is in close proximity to retail, commercial and multifamily assets. It is also near Interstate 8, with connections to five freeway systems allowing for easy commutes throughout San Diego County. According to the offering memorandum, the Mission Valley location also has been one of San Diego’s top-performing office submarkets.
“As a testament to Center Point’s status as one of Mission Valley’s premier multi-tenant office projects, the Property has enjoyed continuous occupancy stability during all phases of the real estate cycle, posting an impressive year end average occupancy of 93.9 percent over the past decade.
In general, San Diego’s office market is beginning to see more activity. According to a 2021 second quarter office market report from Cushman & Wakefield, San Diego reported positive net absorption for the second consecutive quarter since the COVID-19 pandemic. While still reporting a higher than average vacancy rate at 14 percent, this is expected to decrease in the next year as tenants return to the office. In the second quarter of the year, tenants absorbed 324,000 square feet of office space in San Diego.
Cushman & Wakefield did not respond in time to comment on this story.
