PGIM is taking an apparent loss on an office building in Newport Beach, selling it to a joint venture between Ocean West Capital Partners and Rockwood Capital for $64 million.
The 10-story Class A office building was sold at a rate of about $298 per square foot, according to the Commercial Observer. The sale comes six years after PGIM bought the building from Metropolitan Life Insurance Company for $72.3 million.
The property at 1301 Dove Street in Newport Beach was renovated for $11.5 million in 2018, which included upgrades for tenants and the addition of electric vehicle charging stations. The building was constructed in 1980.
More changes are on the way for the building, which is 49 percent leased. Ocean West is looking at adding a new fitness center for tenants, as well as a 7,000-square-foot outdoor patio, according to the Observer.
PGIM was represented by a Newmark team including Kevin Shannon and Paul Jones in the transaction.
Newmark’s third-quarter office report revealed a 12.5 percent vacancy rate in Newport Beach, below the Orange County vacancy rate of 16.1 percent, according to the Observer; the latter is the highest rate for the county in nine years. The average asking rent for Class A office space in Newport Beach is $3.47 per square foot, above Orange County’s average of $2.78 per square foot.
Earlier this year, PGIM and Madison Capital sold a recently revamped mixed-use building in Downtown San Francisco for $165 million. Oakland-based Harvest Properties was the buyer of the 170,000-square-foot building at 360 Spear Street.
Ocean West Capital Partners and Seoul-based Hana Asset Management recently struck a deal with Brookfield to sell the DreamWorks Animation headquarters in Glendale for $327 million. That deal is in escrow and is expected to close in December.
[CO] — Holden Walter-Warner