KBS Strategic Opportunity REIT to Buy Landmark Orange County Office Tower for $147 Million
KBS Strategic Opportunity REIT Inc., a publicly registered non-traded real estate investment trust, agreed to buy City Tower, a nearly 430,000-square-foot office building in Orange, California, according to a filing with the Securities and Exchange Commission. The purchase price is approximately $147.3 million plus closing costs.
KBS Strategic Opportunity REIT Inc., a publicly registered non-traded real estate investment trust, agreed to buy City Tower, a nearly 430,000-square-foot office building in Orange, California, according to a filing with the Securities and Exchange Commission. The purchase price is approximately $147.3 million plus closing costs.
Built in 1988 and renovated in 2015, City Tower is a 21-story, Class A high-rise building located at the connection of the 57, 22 and 5 Freeways, locally known as the “Orange Crush.” The property sits on nearly five acres and is 76 percent leased to 24 tenants. The annual effective base rent is approximately $10.3 million, and the remaining lease term for the tenants is approximately 4.1 years.
KBS Strategic Opportunity REIT intends to fund the purchase with a mortgage loan, as well as proceeds from the $804 million sale in November 2017 of 11 properties to Keppel-KBS US REIT, a newly formed Singapore real estate investment trust. The company has made a $6 million earnest money deposit toward the purchase, but there is no assurance at this time that the company will complete the acquisition.
KBS Strategic Opportunity REIT went effective in November 2009 and closed its primary offering three years later after raising $574 million in investor equity. Â As of the third quarter 2017, the company owned 20 properties with an investment cost of $1.2 billion, according to Summit Investment Research.
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