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Blackstone’s EQ Office sells Costa Mesa office campus at 10% loss
MGR buys newly renovated Canvas complex for $91.5M with Hankey Capital loan
Blackstone has sold an office campus in Costa Mesa for $91.5 million — about 10 percent less than what it assembled it for between 2013 and 2015.
MGR Real Estate, run by Michael Rademaker, bought the 553,000-square-foot complex at 3070 and 3100 Bristol Street, according to Orange County property records. The sale came to about $165 per square foot.
Blackstone’s EQ Office bought 3070 Bristol Street in 2013 for $75 million — when the building was 83 percent leased — and Blackstone purchased the office complex next door for $28.3 million in 2015, records show. Together, the deal came out to about $186 a square foot.
“What you own matters, and U.S. traditional office represents less than 2 percent of our global portfolio today versus more than 60 percent in 2007,” a Blackstone spokesperson said in a statement. “We intentionally pivoted toward sectors like logistics and data centers, which are benefitting from exceptionally strong macro-tailwinds and supply/demand fundamentals.”
The firm completed a renovation of the complex in 2020, knitting two the two separate office complexes together though it didn’t help boost occupancy. When the property, dubbed Canvas, sold this month, it was 68 percent leased, according to Newmark, which arranged financing for the deal.
Hankey Capital provided MGR with a $55 million loan for the acquisition of the complex, according to Newmark. Terms were not disclosed.
The deal marks MGR’s first office acquisition in Orange County, but it has picked up office buildings across Southern California. In January, the firm bought a 147,700-square-foot tower in the Inland Empire city of Ontario for $39 million — about $265 a square foot.
Blackstone, in contrast, has sold off Orange County offices. In April, the firm sold two office towers in Santa Ana for $82 million — also a loss for the firm. Blackstone had bought the 560,000-square-foot Griffin Towers for $129 million in 2014.
However, not all of Blackstone’s recent sales in Orange County have been a loss. In February, the firm also sold VKCC at 16715 Von Karman Avenue in Irvine for about $100 million. Blackstone bought that 450,000-square-foot campus for about $75 million.