Irvine Co. to build six low-rise office buildings in Irvine Spectrum
Orange County’s largest landlord will construct six low-rise office buildings in the Irvine Spectrum, another sign of a robust office market in the state’s third-most-populous county.
Irvine Co. said Monday that it will break ground early next year on a total of 528,000 square feet near the intersection of the 5 and 405 freeways, taking advantage of an improving economy and low vacancy rates.
In a testament to the developer’s confidence in Orange County, it plans to build without tenants lined up and even as it’s building a 20-story office tower nearby. Irvine Co.’s county office portfolio, which totals 25 million square feet, is 96% leased and running out of space for tenants who want to expand, said Doug Holte, president of Irvine Co. Office Properties.
“There is more durable and diverse demand from businesses than we have seen in the last five years,” he said. “We are effectively at full occupancy.”
Four three-story buildings will be constructed at the Discovery Business Center and two four-story buildings at Sand Canyon Business Center. The buildings at each campus will surround plazas with Wi-Fi, meeting areas, sun decks and barbecues so people can “work, collaborate or simply reboot,” Irvine Co. said.
Construction is expected to wrap up in early 2017.
In the second quarter, Orange County asking rents grew 14% from a year earlier, while vacancy dropped two percentage points to 12.7%, according to real estate brokerage Cushman & Wakefield.
Brokers say demand is coming from multiple industries, including healthcare and technology. During the first half of the year, Orange County employment rose 3.3% compared with a year earlier. Out the state’s major job markets, only the Silicon Valley and the Inland Empire saw stronger growth.
Irvine Co. isn’t the only developer looking to take advantage of rising rents and falling vacancy rates.
Trammell Crow Co. recently bought 7.5 acres near John Wayne Airport and plans to open a 545,000-square-foot office project there in 2017.
Twitter: @khouriandrew
