By Meghan Hall
Menlo Park, Calif.-based Menlo Equities has disposed of a key industrial property in the Greater Airport Area in Irvine. In a deal that closed recently, Menlo Equities sold Irvine Crossing, a 395,673 square foot asset, to CBRE Global Investors. According to data released in a recent industry report by Cushman & Wakefield, the property sold for $180.8 million, or about $457 per square foot.
Irvine Crossing is located at 17871 Von Karmen Ave. in one of Southern California’s main data center hubs and Orange County’s business district. Menlo Equities’ website states the property has “substantial” electrical capacity, as well as fiber optics from eight different telecommunications providers.
The asset–about 202,000 square feet– is currently partially leased to Amazon, who uses the facility as a fulfillment center The remainder of the space, about 193,173 square feet, is leased Coral Gables, Flor.-based Cyxtera Technologies Inc., a global data center, interconnection and colocation company.
The industrial sector is “staying hot” halfway through the year as the trade, transportation and utilities sectors in Orange County added 29,800 jobs, a 13.6 percent increase year-over-year. The Ports of Los Angeles and Long Beach are continuing to handle record volumes of goods, with import volume 47.1 percent higher than a year ago. Increased consumer spending, as well as e-commerce sales, are continuing to bolster the industrial sector.
Menlo Equities’ sale, however, marked–by far–the largest industrial transaction of the second quarter in Orange County, according to Cushman & Wakefield. The second largest deal to close was Crown Associates Realty’s acquisition of 15201 and 15461 Springdale Street for $35.5 million, or $288 per square foot.
Other aspects of the industrial sector are also picking up; leasing activity for the first half of the year totaled 6.1 million square feet, a 48.5 percent increase year-over-year. Occupancy gains totaled 506,230 square feet, meaning that OrangeCounty remains one of the tightest industrial markets in the nation, with a vacancy rate of just 1.6 percent. Rental rates have also risen 14.4 percent year over year for traditional warehouse and distribution buildings, with asking rents at $1.11 per square foot. These fundamentals continue to bolster the local industrial market, making developers, investors and tenants all eager to get in on the action.