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2/02/16
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Meridian Property Company has purchased Cotton Medical Center, a two-building, 115.2k sf medical office complex in Pasadena, in a recent $37.5 mil ($325/sf), value-add investment deal. Meridian, a San Ramon-based healthcare property owner/developer, plans to spend more than $5 mil in modernization, efficiency, safety, ADA and machinery improvements, and up to as much as $9 mil total with TI work to repurpose the asset into a modern, state-of-the-art healthcare facility.
Cotton Medical Center covers 2.6 acres and consists of a 53k sf, four-story North Tower building at 50 Bellafontaine St that was constructed in 1974, along with a 62k sf, five-story South Tower building at 50 Allesandro Place, built 10 years later, in 1984. It was sold by a group of doctors, some of whom had been part of the original investors and first tenants of the center.
The property is across the street from the Huntington Hospital and adjacent to the new Shriners Hospitals for Children, which is currently under construction. It was a past winner of the prestigious TOBY award, for a medical office property located in the greater Los Angeles area, given by the Building Owners and Managers Association (BOMA).
Meridian’s renovation of the property will focus first on modernization, efficiency, safety, ADA compliance and mechanical improvements. According to Meridian Chief Operating Officer John Pollock, while the center’s buildings are well-located, their interiors and amenities have not kept pace with the marketplace and the occupancy reflects this difference.
Fred Cordova, Ryan Eddy and Michael Puleo from Kennedy Wilson, along with William Boyd, Linda Lee and Scott Unger of Charles Dunn, represented the seller, Cotton Medical Center LLC. The buyer, Meridian Property Ventures LLC, was represented by Brent Weirick and John Erickson of Colliers International. In addition, John Wadsworth, Angie webber and Dana Nialis from Colliers’ Health Care Properties Group, have been awarded the leasing assignment by the new ownership.
Meridian anticipates strong demand for the redeveloped property, particularly since Cotton Medical Center offers the largest contiguous vacant floorplates within the submarket and it is situated on the campus of nationally renowned Huntington Hospital. Additionally, the MOB submarket in Pasadena has a declining vacancy rate of 10% with increasing demand.
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