Another New Downtown Office Tower in the Works
Boston-based real estate developer Cabot, Cabot & Forbes (CC&F;) has announced it will begin construction in April or May on a 19-story office tower on the downtown block bounded by B, C, Columbia and India streets, and that it has leases to fill 33% of the building.
The $70-million, 343,000-square-foot project will be built on land assembled by Centre City Development Corp., the city redevelopment agency. Title to the property won’t be transferred to the developer until early 1988.
CC&F; hasn’t lined up financing for the project, its first office development in San Diego. “I don’t think that’s going to be a problem with the pre-leasing we have and given that we own 15 million square feet of property,” CC&F; President James Kenyon said Tuesday.
Largest of the five tenants signed to occupy the building is the San Francisco-based law firm of Brobeck, Phleger & Harrison, which will occupy three floors (61,000 square feet). The law firm established a San Diego presence in March when it merged with the San Diego-based Aylward Kintz Stiska Wassenaar & Shannahan. It currently occupies 15,000 square feet in the Coast Savings building.
Other Firms Sign Leases
Also signing leases for the building, to be completed in late 1989, were two San Diego law firms. Dorazio, Barnhorst & Bonar signed for one floor (20,000 square feet), and Maurer, Higginbotham & Harris leased 7,500 square feet. Turner Construction Co. is committed to occupy 2,500 square feet.
A fourth San Diego law firm, which has asked not to be identified, has also reportedly leased one floor.
More than one-quarter of the block, now occupied by warehouses and a hotel, will be an “urban park plaza” fronting C Street. Features of the design by the Los Angeles architectural firm of Skidmore Owings & Merrill include bay windows on the ground and top floors. The building’s facade will be built with precast concrete.
Cabot, Cabot & Forbes’ majority owner is Marshall Field V, scion of the Chicago department store family. The firm owns 15 million square feet of office and industrial space in 20 states.
Kraig Kristofferson, a Coldwell Banker leasing agent who with associate Jim Hollis will handle leasing at the new structure, said downtown San Diego’s office vacancy rate stands at about 14% of the 7-million-square-foot inventory. Space at offices with bay views built in the past 10 years, however, is at a premium, Kristofferson said.
High Growth Rate
Kenyon acknowledged that San Diego’s vacancy rate is high but said his firm is encouraged by the fact that San Diego’s occupancy growth rate of 4.5% per year is significantly higher than the average nationwide occupancy growth rate of 2.4%.
The CC&F; building is one of half a dozen high-rises being talked about for downtown San Diego. However, only one of the new generation of buildings, the 521,000-square-foot Symphony Towers on B Street at 7th Avenue, has actually begun construction. As with the CC&F; project, Symphony Towers began with a high level of pre-leasing.
Kristofferson said construction lenders, mindful of the nationwide glut in “see-through,” or unoccupied, offices in the early 1980s that left many financial institutions holding the bag, now stipulate that a significant percentage of a new building’s space be leased before construction can begin.
