At a glance
- Newmark arranged the $27.25 million sale of the 56,815-square-foot R&D building in El Segundo, California, which is fully leased on a triple-net basis to Rivian; Majestic Realty is the buyer, according to Connect CRE.
- Hackman repositioned the 1967 building, renovated in 2020, and leased it first to Boeing and later to Rivian, which uses the site as a customer-facing service center and a secure R&D facility supporting its consumer and commercial vehicle lines.
- The eight-year hold is the redevelopment trade working as intended: buy an aging shell, spend on renovation, sign a triple-net lease, and sell at a price that reflects the rent roll more than the local office market.
At $480 a foot, the sale of 401 Coral Circle is more a bet on Rivian's lease than on the South Bay office market. Newmark arranged the $27.25 million sale of the 56,815-square-foot R&D building in El Segundo, California, which is fully leased on a triple-net basis to Rivian; Majestic Realty is the buyer, according to Connect CRE. Newmark represented seller Hackman Capital Partners with a team that included Kevin Shannon, Rob Hannan, Ken White, Laura Stumm, Michael Moll, Ryan Plummer, Andrew Briner and Aaron Banks.
That price is a 78% gain over the $15.3 million Hackman paid in 2018. Hackman repositioned the 1967 building, renovated in 2020, and leased it first to Boeing and later to Rivian, which uses the site as a customer-facing service center and a secure R&D facility supporting its consumer and commercial vehicle lines.
The eight-year hold is the redevelopment trade working as intended: buy an aging shell, spend on renovation, sign a triple-net lease, and sell at a price that reflects the rent roll more than the local office market. The 78% gain is the payout for carrying a 1967 building through a renovation and two tenant transitions. For Majestic, the purchase is a 100% leased asset at $480 a foot, a number that would be hard to justify for a conventional suburban office building but makes sense when the buyer is effectively underwriting Rivian's lease obligations with the building as collateral.
The sale also gives the South Bay a fresh comp: a building that combines a customer-facing service center and secure R&D space is more specialized than a generic office box, which helps explain the per-foot price. Brokers are likely to cite 401 Coral Circle at $480 a foot in the next net-lease R&D assignment, and the trade is a useful reminder that the value came from repositioning and tenant selection rather than a rising tide in office demand. Connect CRE attributes the result to the strength and desirability of the South Bay market, but a fully leased triple-net asset in this niche can clear on terms that ignore the broader office stock's troubles.
For Newmark, the El Segundo sale adds to a busy month: in August the firm also announced a $277 million construction loan on a Jersey City tower. Neither mandate is a headline trophy trade; the market right now is being made by working assets like apartment construction loans and net-lease R&D buildings, not by the marquee office trades that dominated the last cycle. At $27.25 million, this deal sits below the trades that capture headlines, but it reveals where pricing actually stands in the South Bay.
Reported by the Deals desk from Connect CRE and PRED records. Published . Corrections