JLL Income Property Trust has acquired a Class A medical office property, Genesee Plaza, in San Diego, California for $90 million.
“The acquisition of Genesee Plaza is a strong fit for JLL Income Property Trust’s focus on medical office buildings as they have historically featured higher tenant retention and delivered stable income. Our focus on reducing risk within our portfolio as we get later in the current economic cycle stems from our investment objectives to deliver stable income and protect stockholder value,” said Allan Swaringen, President and CEO of JLL Income Property Trust.
“While we remain underweight to the office property sector which accounts for only 14% of our $2.8 billion portfolio, four of our six office properties are medical office buildings,” he added.
“Medical office fundamentals remain strong as evidenced by low vacancy rates, healthy net absorption and the balanced introduction of new supply. As healthcare delivery in the U.S. continues to transition to outpatient settings, Class A MOBs like Genesee Plaza are well-positioned to help meet JLL Income Property Trust’s objective of providing attractive returns to investors,” said Steve Bolen, LaSalle’s Head of U.S. Healthcare Real Estate.
Genesee Plaza is located at a prominent intersection in San Diego’s University Town Center benefiting from access to major highway systems and a strong surrounding daytime foot traffic from local businesses.
The Class A medical office property’s location is in close proximity to the University of California, San Diego and Scripps Hospital Campuses. The property’s coastal infill location has seen severe supply constraints with high barriers to entry from both geographic barriers and zoning restrictions.