Newmark announces it has completed the sale of Sorrento Heights, a two-building office project comprising 92,875 square feet and located at 9980 and 10020 Huennekens Street in San Diego, California for $41.3 million. The property’s Sorrento Mesa location, situated at the confluence of San Diego’s surging life science and technology markets, offers an opportunity for near-term conversion or ground-up development to a state-of-the-art life science campus.
Newmark Co-Head of U.S. Capital Markets Kevin Shannon and Executive Managing Directors Brunson Howard, Paul Jones and Ken White represented the seller, a fund managed by DRA Advisors LLC in partnership with Cypress Office Properties. The buyer was Bioscience Properties, Inc and Harrison Street.
“Sorrento Heights is uniquely positioned to benefit from exceedingly strong fundamentals in both the life science and technology sectors,” said Howard. “These two sectors are benefitting from record venture capital investment into the San Diego marketplace.”
Sorrento Heights includes two, two-story office buildings totaling 92,875 square feet. 9980 Huennekens Street comprises 60,335 square feet and 10020 Huennekens Street measures 32,540 square feet. The project is situated on four contiguous parcels that total 5.23 acres. An open breezeway and outdoor seating area join the two buildings, which offer an ample 4.6/1,000 square foot parking ratio. The property is 68% available, as the project’s largest tenant has placed the entirety of the 10020 Huennekens Street building on the market for sublease. This offers the new owner strong prospects for life science conversion or redevelopment.
Shannon added, “The Sorrento Mesa life science and technology real estate market is extremely supply-constrained with very few sites remaining for future development. A state-of-the-art life science building in Sorrento Mesa, dependent on use specifics, carries an estimated replacement cost of well over $1,000 per square foot.”
According to a report from Newmark Research, the San Diego life sciences market is among the most established life sciences clusters in the country. Along with Boston and San Francisco, San Diego is a primary epicenter of life sciences activity. The three markets combined have an estimated 16.6 million square feet of lab space under construction and under renovation, with another 54.5 million square feet proposed. San Diego ranks third in the report’s proprietary Life Science Index, which scores clusters based on factors such as market maturity, market momentum, demographic and structural components supporting life sciences, and future growth potential.
Newmark Group, Inc. (Nasdaq: NMRK), together with its subsidiaries (“Newmark”), is a world leader in commercial real estate, seamlessly powering every phase of the property life cycle. Newmark’s comprehensive suite of services and products is uniquely tailored to each client, from owners to occupiers, investors to founders, and startups to blue-chip companies. Combining the platform’s global reach with market intelligence in both established and emerging property markets, Newmark provides superior service to clients across the industry spectrum. Newmark generated revenues in excess of $2.2 billion for the trailing twelve months ending June 30, 2021. Newmark’s company-owned offices, together with its business partners, operate from over 160 offices with approximately 6,200 professionals around the world.