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Commercial Real Estate

RREEF Fund Buys Office Properties in Southland

July 23, 2002|BRAD BERTON | SPECIAL TO THE TIMES

An affiliate of Chicago-based investment advisor RREEF, one of the nation's most active real estate investment managers, bought a 780,000-square-foot portfolio of mostly office buildings in Cypress and Anaheim for a combined price estimated at about $107 million.

RREEF, which declined to comment on the sale, purchased the fully leased buildings from an investment fund managed by Newport Beach-based Layton-Belling & Associates. They include Mitsubishi Electric's U.S. headquarters in Cypress, an adjacent business park and Anaheim Corporate Plaza near Edison Field.

Mitsubishi leases the entire five-story office building at 5665 Plaza Drive in Cypress and is one of the tenants at the adjacent complex at 5757 Plaza Drive. Other tenants include PacifiCare Health Systems and Jacobs Engineering.

The Anaheim Corporate Plaza along Orangewood Avenue is home to numerous tenants, including Blue Cross and Pacific Bell.

The Layton-Belling fund, which specializes in improving under-performing commercial properties, renovated all the buildings and brought them to full occupancy before offering them for sale. The fund is a joint venture of Layton-Belling and Boston-based real estate advisor AEW Capital Management.

The venture took over the Cypress properties three years ago as part of a large portfolio acquired from Japan-based Shuwa Investments Corp.

Layton-Belling co-founder Phil Belling confirmed that the sale closed, but declined to disclose financial details. Officials at RREEF also declined to comment. The transaction was brokered by Secured Capital Corp. and Cushman & Wakefield.

The new owner is an institutional fund known as RREEF America II, which typically buys stabilized real estate that is well-leased with predictable revenue streams.

RREEF owns and manages dozens of California income properties on behalf of its investor clients, which include the California Public Employees' Retirement System and the Los Angeles County Employees' Retirement Assn.

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