Harbor Associates LLC and its joint-venture partner The Bascom Group LLC have acquired office buildings in Los Angeles and Del Mar, California, in separate transactions totaling $37.4 million. The latest transactions extend the relationship enjoyed by the two companies, who over the last three years have invested more than $250 million in a portfolio of 18 office buildings with an aggregate square footage of 1.2 million square feet in Southern California and Colorado.
The Harbor-led JV acquired a 39,000-square-foot office building at 2010 Jimmy Durante Boulevard in Del Mar for $15.7 million. The two-story property is located within a half-mile of the beach and Downtown Del Mar and within a quarter-mile of the 370-acre Del Mar Fairgrounds. The project offers convenient access to all of San Diego via the I-5 Freeway.
Harbor will rebrand the project as The Bungalows at Del Mar, with major renovations to include a new modern paint scheme throughout the project, installation of bike and surfboard storage along with new outdoor showers, and new outdoor seating and collaboration areas. The tenant suites include operable windows and vaulted ceilings.
According to Harbor principal Paul Miszkowicz, the rebranded project will present the most unique creative office experience in coastal San Diego. “This asset fits perfectly into our business model,” Miszkowicz says. “We’re confident we can transform this well-located and architecturally unique but tired asset into a modern class-A coastal creative office campus. Our vision is to make The Bungalows one of the most unique properties in coastal San Diego.”
Joe Anderson of Cushman & Wakefield represented the seller and will handle leasing efforts for the buyer. Greg Brown and John Chun of HFF arranged the financing for the project with Ready Capital Structured Finance, a division of a subsidiary of Sutherland Asset Management Corporation.
The JV also acquired a 75,000-square-foot office building at 4130 Cahuenga Boulevard in the Los Angeles submarket of Toluca Lake for $21.7 million. Situated next to the NBC Universal Motion Picture and Television campus, the building is within five miles of NBC Universal, CBS, Warner Bros., The Walt Disney Company, Paramount Pictures, and DreamWorks. It is also located within a half-mile of Highways 101, 134, and the Universal City/Studio City Metrolink station, providing easy access to Hollywood and Downtown Los Angeles.
The L.A. acquisition also features architectural wood on the exterior and unique physical features that are expected to cater well to the rapidly expanding media, entertainment, technology, and advertising fields. The business plan calls for a multimillion-dollar capital improvement program to modernize and refresh the asset. As part of the renovation, the project will receive substantial cosmetic upgrades to the building exterior, lobby, and common areas, according to Harbor principal Joon Choi.
Sean Fulp of Newmark Knight Frank represented the seller in the Los Angeles transaction. Brian Halpern and Alex Kane of JLL arranged the financing for the project with Ready Capital Structured Finance, a subsidiary of Sutherland Asset Management Corporation.
Harbor and Bascom plan to expand its platform and invest an additional $500 million throughout the Western U.S. over the next two years. The expansion of the joint venture platform is an example of the collaborative vision the two companies share, according to Bascom managing partner Jerry Fink.
“Harbor has proven to us its ability to identify solid value-add investments with potential for excellent risk-adjusted returns,” Fink says. “We look forward to continuing our relationship and work toward our goal of acquiring $500 million in office assets over the next 24 months.”