Office and Healthcare Portfolio for Sale in California and Texas

Monday, April 15, 2019

HFF, on behalf of the owner, is marketing a portfolio of three single-tenant, net-lease office buildings totaling 221,192 square feet in Brea, California, and Lubbock, Texas. The portfolio includes the 104,662-square-foot building at 2727 East Imperial Highway and the 95,650-square-foot building at 2767 East Imperial Highway, both in the Orange County community of Brea, California, along with the 20,880-square-foot property at 3601 21st Street in Lubbock, Texas. The buildings are fully leased and either available as a portfolio or individual offerings.

Office Portfolio Investment Highlights

  • Quality Tenancy:  2727 East Imperial Highway is occupied by Collins Aerospace, one of the world’s largest suppliers of technologically advanced aerospace and defense products. The property features a highly specialized buildout for Collins Aerospace, with significant tenant investment since the tenant’s commencement in June 2012. With 3.5 years of remaining lease term (with 3% annual rent increases), the property offers a tremendous value creation opportunity for potential investors. 2767 East Imperial Highway is fully leased to St. Jude Hospital (“St. Jude”), a wholly-owned subsidiary of Providence St. Joseph Health (S&P: AA-). St. Jude recently extended their lease, and there are approximately 14 years left of remaining term. 3601 21st Street is occupied by Covenant Health System, a wholly-owned subsidiary of Providence St. Joseph (Moody’s: Aa3). Covenant is the largest healthcare institution in West Texas with six primary acute-care hospitals, more than 20 clinics, 50 physician practice locations, more than 5,000 employees and over 600 physicians. Covenant’s network spans across 62 counties and more than 175 miles from Lubbock, serving an area of 1.2 million people in the region.
  • Ideal Locations for Corporate and/or Medical Tenants:  With frontage along Imperial Highway, the Brea commercial properties for sale also benefit from easy access to the 57 Freeway, the city’s most important north-south arterial connecting the area to San Gabriel Valley and the Inland Empire to the north and Anaheim to the south. Additionally, 2767 East Imperial Highway is within a five-mile drive of the 320-bed St. Jude Hospital in Fullerton, which is part of the same investment-grade health system as the tenant. The Lubbock property is situated within the 200-acre Lubbock Medical District, the largest medical corridor in West Texas with 3.5 million square feet of healthcare real estate. It’s also at the front door of the 394-bed Covenant Medical Center, the largest hospital by both bed count and revenue in the Covenant Health System network. 
  • Strong Market or Economic Fundamentals:  Brea stands as one of the top-performing markets in all of Orange County, with terrific recent market growth and rental rate appreciation. Brea benefits from its direct accessibility to major cities while simultaneously enjoying its quaint, suburban community. Home to more than 5,000 businesses, Brea features one of the largest concentrations of corporate tenants in Orange County. Despite the recent surge in rental rates of 13.4% over the last three years, rates are still below prior cycle peak levels. Lubbock is the Southwest’s preeminent medical center between the Dallas-Fort Worth Metroplex and Phoenix. With an Unemployment Rate of 2.6%, the economy is diverse, with elements associated with mechanized agriculture, the petroleum industry, distribution centers and high-tech entities, as well as strong elements based on higher education and healthcare. Its diversity and provincial nature typically allow it to remain somewhat insulated from the wide swinging cycles of the national economy

For more information on this commercial real estate listing, please contact Andrew Harper, Evan Kovac, Andrew Milne and Nicholas Foster.  To view HFF’s current real estate investment listings, please click here to be directed to HFF’s property search page.

Holliday GP Corp. ("HFF") is a real estate broker licensed with the California Department of Real Estate, License Number 01385740.

Holliday GP Corp. ("HFF") is a Texas licensed real estate broker.

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