Pacific Oaks Education Corp. has acquired the Pasadena office complex where it leases space for $21.5 million, or $287 a square foot, aiming to keep the site as its permanent home with room to expand.
Operating as Pacific Oaks College and Pacific Oaks Children’s School, the Pasadena-based nonprofit purchased the four-building campus from NW Innovation Center on May 18, said its representatives from Newmark Knight Frank. (The brokerage recently dropped “Grubb” from its name.)
Pasadena city records from April show that Pacific Oaks needed city officials to approve the acquisition, which they did, because it planned to receive a tax-exempt loan for as much as $22 million from the Illinois Finance Authority. Pacific Oaks belongs to a Chicago-based nonprofit network of colleges, TCS Education System, which qualifies for the loan. City records also documented the purchase price, and that Pacific Oaks planned to spend $2 million on renovations including upgrades to the library, classrooms, and common spaces.
Newmark’s Josef Farrar, who represented Pacific Oaks with David Kluth and Aliya Coher, said Pacific Oaks had been looking to buy space in Pasadena for four years but was limited by zoning restrictions for higher-education facilities. NW Innovation Center, represented by CBRE’s Mark Shaffer and Kevin Duffy, wasn’t initially interested in selling the 75,000-square-foot campus, which was built in 1964 and renovated in 2006, Farrar said.
Pacific Oaks occupies 45,000 square feet, and the State of California is the next largest tenant. Monthly office rents in Pasadena range from roughly $2.50 to $4 a square foot, Farrar said. Pacific Oaks will end up saving on costs in the long run, while keeping the flexibility of being able to contract or expand, he added.
“It was a strategic play in terms of looking at operational needs and controlling their destiny,” Farrar said. “It makes sense for them to have a crystal ball that tells them what the costs are.”
Real estate reporter Daina Beth Solomon can be reached at [email protected]. Follow her on Twitter @dainabethcita for the latest in L.A. real estate news.
