San Diego office property

Real Estate Alert, April 14, 2004

American Assets won the bidding for SBC Plaza, a 401,000-sf building at 101 West Broadway in San Diego. The local player, headed by Ernest Rady, bested 32 others with a $116 million bid, which included a $2 million non-refundable deposit. The price translates into an initial yield of 7%. Competition was heated--the property was originally expected to trade for about $100 million--as American Assets beat out Teachers Insurance, Wells Real Estate, KBS Realty Advisors, LaSalle Investment Management and RREEF, among others.

The building is 91% occupied, with 40% of leases rolling in 2005 and 2006. The seller is a joint venture between GE Pension Trust and local player Sentre Partners. Secured Capital is handling the sale, which should close later this month.