By Jon Peterson
Fairfield-based CDI Companies has placed the 108,010 square foot office property on the market for sale in Fairfield, known as Busch Campus Park. According to sources familiar with the property, the pricing guidance on the sale is in the neighborhood of $20 million, or roughly $185 per square foot at that pricing level.
The property owner was the original developer of the property when it was constructed in 1998.
The listing agent on the sale is Colliers, engaged through its Institutional Capital Markets team in Northern California. Two people working on the transaction are Kevin Moul, executive vice president in the San Jose office, and Brad Idleman, an executive vice president in the San Francisco office.
According to some sources, the property is anticipated to attract a significant amount of interest from capital sources. The suburban office product is gaining some traction with major buyers across the country. The property type has also benefited from the recent working trends and the need for companies to expand their footprints across regions where they operate and provide working opportunities closer to where people live.
The Busch Campus Park is located across several addresses at 350, 370, 450, 490 and 500 Chadbourne Road. It is considered a mixture of office, medical office and executive office types of space. When the property’s marketing efforts began, it had an occupancy of 88 percent.
Two factors make the property a value-add investment opportunity for the new owner. One is the ability to transform a portion of the office component into medical office space, which is in robust demand presently. The other is to allow a marked-to-market opportunity that would raise the rents, which according to some estimates, are below market levels.
According to data compiled by Colliers, the Fairfield office market showed very little activity in terms of depleting vacancy during the first quarter of 2022. Vacancy at the end of the first quarter in 2022 stood at 26.8 percent, down just slightly from the previous quarter of 26.9 percent. The entire Fairfield office market has 2.1 million square feet, with no new construction planned for the future.
The Registry has been following the Fairfield market closely, and over the last 12 months, most of the transactions centered around multifamily and industrial opportunities. In January of 2021, BentallGreenOak purchased the 607,208 square foot North Bay Logistics Center in the city for $73.5 million. In September, Dermody Properties acquired a 49-acre lot where it planned to develop a 700,000 square foot logistics park.
On the multifamily side, a 63-unit apartment community, The Vines on 80, sold for $21.5 million in December of 2021. Opportunity Housing & California Statewide Communities Development Authority (CSCDA) spent $83.5 million to acquire the 200-unit Park Crossing Apartments. Another apartment deal closed in October of last year, when Elements@1600, a 120-unit property, sold for $30 million.
In the medical office arena, Anchor Health spent around $12 million to purchase a newly-built 30,000-square-foot property on 2470 Hilborn Road. This motivated the Wiseman Company to place on the market for sale in January of 2022 the Green Valley Executive Center in Fairfield located at 5030 Business Center Drive. According to the property’s offering document, the asking price for this property is $25.4 million, or just around $530 per square foot.