New Owners Of Irvine Site To Pivot From Office To Hotel Development
Although a parcel at 17850 Von Karman Ave. in Irvine has long been slated to become an office tower, the owners appear to have sold it off to a company with plans to instead pivot the project to hospitality.
Owners Hines and Oaktree Capital are selling the property to Florida-based RK Hospitality Development, according to the Orange County Business Journal. RK wants to build a five-story, 172-room Home2 Suites, an extended-stay brand owned by Hilton.
The hotel proposal is working its way through the planning process with the city of Irvine. The site is now in use as a 30K SF parking lot.
If built, Home2 Suites would not be the only extended-stay hotel in the area. A 124-room hotel called Element Irvine, which will be operated by Marriott, is expected to open next month.
Orange County's hotel market has been on the upswing, according to a year-end report from Atlas Hospitality Group. Individual transactions in Orange County were up 152.6% at the end of 2021 compared to their 2020 numbers, and the price of the average room went up 23.9%, from about $150.5K per room to about $186K per room.
A joint venture between Hines and Oaktree Capital Management purchased the property in 2013 for $5M. Hines and Oaktree planned to break ground on a 237K SF office building in 2017, but they were waiting to lock in some tenants before breaking ground. The team gave up plans for the hotel last year amid an uncertain office market, the OCBJ reports, citing unnamed sources.