By Carrie Rossenfeld
SAN DIEGO – Bixby Land Co. has purchased four office buildings here in two separate transactions totaling $21.8 million with plans to invest $16.5 million in renovating them as creative-office space. The investments mark the firm’s ongoing focus of developing innovative workplace designs in select markets throughout California.
The first purchase was Mira Mesa Business Park, a 58,701-square-foot, three-building office park in the Sorrento Mesa submarket, one of the premier technology submarkets in San Diego. The project was purchased from 5889 Oberlin Drive Associates for $9.3 million, and Bixby plans to invest $6.5 million to completely redesign it. Lynn LaChapelle and Bob Prendergast of JLL represented the seller in the transaction.
New glazing, lobbies, upgraded elevators and a full landscaping and signage renovation will be completed on the property over the next six months. The development will also include three separate Bixby Retreat outdoor amenities areas, a feature that Bixby has pioneered in Silicon Valley and that has proved to be in high demand by tenants.
The second transaction involved a four-story, 76,315-square-foot office building at 9797 Aero Dr. in the Kearny Mesa submarket here, for which Bixby paid $12.5 million. The unnamed seller was represented by Thomas Mercer, Derek Hulse and Ty Moffatt of Colliers International. The building features good access and high visibility to the I-15 freeway and was vacant at the time of sale.
Bixby is planning a $10-million repositioning that includes the addition of 15,783 square feet of new office space, as well as the Bixby Retreat, an energetic outdoor living room with numerous amenities.
According to Bill Halford, president and CEO of Bixby, “These are both outstanding opportunities to develop innovative space in excellent markets where demand is high.”
Halford adds that companies place a premium on work environments where their employees can enjoy the outdoors without having to leave the property. “Our designs offer that experience, with highly amenitized outside areas that are a perfect fit for San Diego’s active lifestyle.”
Bixby’s office-development strategy has involved meeting the lifestyle needs of today’s companies, including contemporary designs and amenities that more closely convey the ambiance of a boutique luxury hotel than a conventional office building. Halford says his firm tends to “put more emphasis on design than many of our competitors. Tenants are more apt to focus on a better product than on price. We learned in Silicon Valley that there are a disproportionate number of firms that want the best product, and we think that expectation is equally prevalent in San Diego.”
The firm has invested more than $400 million in 30 buildings throughout California over the past three years, including creative-office developments in Silicon Valley, Los Angeles and Orange County. These most recent acquisitions signal the company’s continuing interest in the San Diego area. GlobeSt.com was unable to reach Bixby before deadline to discuss the similarities and differences between the Northern and Southern California creative-office markets.
As GlobeSt.com reported in August, the new amenities currently coming out of the office sector are curiously similar to those in the apartment sector. Halford told us with three office projects currently in the development pipeline, including the 405,000-square-foot Lake Park project in Santa Clara and two buildings in Orange County, and the recent $52.1-mllion sale of recently repositioned office complex in San Jose, his firm was “actively seeking new opportunities to create innovative workplaces for the widening market of tenants that demand more from their office space.”