Computer chip and software developer Broadcom purchased the Irvine office compound it rented in the latest example of a well-funded company taking advantage of depressed real estate prices to switch from renter to owner.
Broadcom paid its former landlord, PRP Real Assets, $325 million for the 660,000-square-foot research campus near the junction of the 5 and 405 freeways in one of the largest office sales in Southern California in recent years.
The unusual deal was a reacquisition for Broadcom, which developed the property as an office and research-and-development complex before selling the campus for roughly $443 million in 2017.
At that time, it agreed to lease it for 20 years, real estate data provider CoStar said. PRP acquired the campus for $355 million in 2020.
The campus consists of two five-story office buildings at 15101 and 15191 Alton Parkway.
Completed in 2017 and 2018, the campus was designed to be Broadcom’s corporate headquarters with significant research-and-development capabilities.
Broadcom, now based in Palo Alto, is one of the world’s largest semiconductor and infrastructure software companies. It makes components for iPhones, optical networking and other products.
Through acquisitions of other tech firms, the company has assembled a portfolio of 17 owned properties totaling more than 2.2 million square feet, according to CoStar data.
“You rarely see an Orange County office deal of this size, and almost never from an occupier rather than an investor,” said Jesse Gundersheim, a senior director of market analytics for CoStar. “Broadcom is taking control of a campus that is already critical to its business.”
Companies occupying their own buildings accounted for 34% of Orange County office sales volume over the past year, compared with a five-year average of 24%, CoStar said.
In Los Angeles, fund manager Capital Group earlier this year agreed to pay about $210 million for the 55-story Bank of America Plaza atop Bunker Hill, where it has offices.
Others choosing to buy over rent include Riot Games and the Los Angeles Department of Water and Power.
“We knew the best landlord we could possibly have would be ourselves,” Capital Group Chief Executive Mike Gitlin said in April.
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