A
joint venture between Orange County investment firms Harbor Associates and F&F Capital Group has acquired the Highlands Corporate Center in San Diego's Del Mar Heights neighborhood for $77 million. The five-building, Class A office campus spans 211,000 square feet and is about 90% leased. Located at 12730-12780 High Bluff Drive, the property offers proximity to the One Paseo mixed-use center, which has contributed to its leasing success with 40 new leases and renewals over the past three years.
The purchase price works out to approximately $365 per square foot, a significant premium compared to current office building prices in Downtown Los Angeles. Harbor Associates represented itself in the deal, while Eastdil Secured's Adam Edwards, Justin Shepherd, and Bailey Bland represented the undisclosed seller.
F&F Capital Group sees this acquisition as an opportunity to invest in high-barrier-to-entry markets with a "reset" on office pricing. This transaction marks the latest activity in San Diego's office investment market, which saw increased trades in the third quarter according to Jones Lang Lasalle. Office vacancy in San Diego reached 14% in the same period, driven by renewals and relocations.
