SAN DIEGO, July 26, 2021 /PRNewswire/ -- Newmark1 announces it has arranged the sale of Sorrento Towers, a 296,327-square-foot Class A office complex in the heart of Sorrento Mesa, San Diego. The asset traded for $146 million.
Newmark's Co-Head of U.S. Capital Markets Kevin Shannon and Executive Managing Directors Brunson Howard, Ken White and Paul Jones represented the seller, Shorenstein Properties. The buyer was Prime US REIT, based in Singapore. KBS serves as the U.S.-based asset manager for the portfolio, which included identifying and sourcing this asset on behalf of the portfolio.
"Sorrento Mesa, and for that matter San Diego, is at the confluence of the life science and technology industries in Southern California," said Howard. "This transaction is emblematic of how compelling that story is and bodes exceedingly well for this submarket and San Diego at large as we transition into a post pandemic marketplace."
Shannon added, "There are a few submarkets nationally where the liquidity post pandemic is better than pre pandemic. Sorrento Mesa is one of them due to the life science engine gobbling up existing office inventory."
Sorrento Towers is a Class A property, located at 5355 and 5375 Mira Sorrento Place, that consists of two seven-story office buildings situated atop a multi-level parking structure. Built in 1990, Sorrento Towers is a LEED Gold-certified life science/office asset conveniently positioned just south and east of the I-5/I-805 interchange and accessible to I-15 and other major local roadways. The property is centrally located in the San Diego region with easy access to surrounding business centers, public transportation and residential communities.
Sorrento Towers is one of three assets KBS has assisted PRIME in acquiring for its portfolio since listing on the Singapore Exchange in 2019. "At 98.2% occupancy, Sorrento Towers is one of the most sought-after properties in San Diego's premier innovation hub and is within walking distance of over 60,000 square feet of high-quality retail amenities," says Gio Cordoves, Western regional president for KBS. "Through this transaction, KBS has assisted PRIME in securing another opportunity to add value to this portfolio."
Sorrento Towers recently underwent significant common area upgrades totaling more than $8.4 million including an expanded first-floor curtain wall that captured additional ground-floor area; a fully renovated, open-air plaza; completely renovated main lobbies; renovated elevator lobbies, elevator cabs and restrooms; and new amenity spaces that include a state-of-the-art fitness center, conferencing spaces, a training center and multiple outdoor, collaborative meeting areas. Additionally, Shorenstein invested approximately $16.7 million for new, best-in-class tenant improvements within the last two years alone. KBS is planning a series of additional upgrades to the property, including further restroom renovations, further additions to outdoor meeting areas, space activation and WiFi enhancements.
The Sorrento Mesa submarket is home to San Diego's largest concentration of technology companies, including those in the life science, biotech and med-tech sectors, telecommunications, wireless applications and healthcare. Life sciences conversions of older office properties has become more prevalent throughout San Diego in recent years. The region remains extremely attractive to national technology companies, financial institutions and defense contractors, due to its educated workforce and robust venture capital investments. Net absorption turned positive for San Diego's office market after five consecutive quarters of losses, posting 127,007 square feet in gains, according to Newmark Research.
About Newmark Newmark Group, Inc. (Nasdaq: NMRK), together with its subsidiaries ("Newmark"), is a world leader in commercial real estate, seamlessly powering every phase of the property life cycle. Our comprehensive suite of services and products is uniquely tailored to each client, from owners to occupiers, investors to founders, growing startups to leading companies. In 2020, Newmark generated revenues in excess of $1.9 billion. Newmark, together with London-based partner Knight Frank and independently owned licensees, operates globally from approximately 490 offices with 19,300 professionals. To learn more, visit nmrk.com or follow @newmark.
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