Guthrie Development Co. has sold Placentia Office Park in Placentia, California, for $10.4 million to a private investor. The property, which is located at 701 and 711 Kimberly Avenue, consists of two office buildings totaling 72,897 square feet.
Guthrie had acquired the buildings in June 2017 from an institutional owner and then pursued a renovation plan including a new silicone-roof overlay system, new parking lots, and new building paint. The rent roll was stabilized with new and renewal leasing. The project is currently 90 percent occupied and includes tenants such as North American Title Co. and Sunrise Growers.
Newmark Knight Frank (NKF)’s senior managing director Paul Jones, director Blake Bokosky, and senior associate Brandon White represented Guthrie in the sales transaction. The buyer was represented by NKF senior managing director Drew Sanden.
Peter Schafer, project manager at Guthrie Development, tells SoCal Real Estate, “The North Orange County office market is experiencing shrinking vacancy rates and increasing rents without any major new supply scheduled to hit the market. The market fundamentals are excellent today and have room to improve in the future. We placed our bet on the nicest property in the market with immediate freeway access.”
Guthrie says this project fits in with the company’s business plan of adding value to Southern California industrial and office properties and that his firm was drawn to the property by the short-term rollover on the rent roll. “Where many potential buyers saw uncertainty with cash flow, we saw an opportunity to increase NOI by renewing tenants at market rates. The property was very well maintained, but the roofs and parking lots had reached the end of their useful life and needed help. We thought we could increase value in a short period of time, and our capital expenditures were easily quantified.”
Guthrie’s renovations positioned the property as the premier office space in this small submarket. While the submarket is not a premier destination such as Newport Center or the Platinum Triangle, the property has attracted top tenants due to its freeway proximity near the 57 and 91 freeways and first-class building features and maintenance.