An office campus in Costa Mesa, listed initially for $33.9 million, has recently been sold for $19.75 million. The 58,193-square-foot office campus in Costa Mesa, located at 660 Baker Street, was sold for approximately $339 per square foot.
Originally built in 1975, the campus comprises four buildings and was previously owned by an entity affiliated with El Segundo-based Dunbar Investments, which acquired the property in 2018 for about $13.7 million. Since the acquisition, the campus has undergone substantial upgrades, including around $12 million in renovations in 2019. These improvements included $4.3 million in exterior renovations and $7.7 million in interior common area updates, according to previous reporting by The Registry.
The office campus was fully occupied when it hit the market, housing a variety of tenants such as MemorialCare, Schiefer Media, Western Lighting, and PV Labels Inc. In total, there are 11 tenants, with none occupying more than 17 percent of the space.
The property is situated in a prime business district of Orange County near South Coast Plaza, one of the region’s largest shopping centers. It also offers easy access to Interstate 405 and State Route 55.
The sale reflects changing office market trends in Orange County. The Registry recently reported that in the second quarter of 2024, the Orange County office market saw a slight 0.5 percent increase in occupied space, reducing the vacancy rate to 12.7 percent—a 70-basis point decrease year-over-year. This drop in vacancy, with 19.9 million square feet of empty office space, is partly due to a decline in new construction, which is at its lowest since 2010.
Leasing volumes have dropped by 11 percent year-over-year, due to softer demand and concessions from landlords, such as lower rents and flexible terms. The average asking rent remained stable at $2.80 per square foot, with a 5.7 percent annual increase.
Sales activity has decreased sharply, with a 55 percent drop in sale volume and a 27.4 percent reduction in the average size of sold properties, highlighting market cautiousness and shifting investor preferences towards smaller properties.
