Long-Term Defense Tenant Draws Institutional Buyers to $400M California Sale
A 634,000-square-foot office and research campus in Costa Mesa, California, leased entirely to defense technology company Anduril Industries is on the market for roughly $400 million. Invesco and SteelWave own the property, which serves as Anduril’s headquarters under a lease with 13 years remaining. Eastdil Secured is handling the sale. The valuation is based on a $251 million mortgage from a Pimco real estate fund secured in September, typically representing about 65 percent of a property’s value.
Marty Pupil of Stream Realty Partners in Irvine, California, said the investment reflects Anduril’s credit quality and long-term federal government contracts rather than broader market conditions. He expects a large U.S. or foreign institutional fund to acquire the asset. Anduril, founded in 2017, develops aerial drones, surveillance networks, and autonomous underwater systems using artificial intelligence. The company raised $7.5 billion over the past year and was valued at $61 billion in a May funding round led by Thrive Capital and Andreessen Horowitz.
Southern California has become one of the nation’s fastest-growing defense technology hubs, driven by increased federal spending and evolving weapons strategies since conflicts in Ukraine and Iran. Venture capital investment in U.S. defense technology startups reached $11.4 billion through mid-June, more than double the $4.6 billion invested during the same period last year. Anduril announced plans in January for a $1 billion production facility in Long Beach and is building a 5 million-square-foot industrial park in Ohio for combat aircraft production.
If completed near the estimated price, the Costa Mesa deal would be the largest office transaction in the region this year, surpassing the $210 million sale of Bank of America Plaza in Los Angeles this month. Invesco and SteelWave bought the property, a former Los Angeles Times printing plant, for $65 million in 2017 and finished extensive renovations in 2023. Single-tenant properties with long-term leases to creditworthy tenants have attracted investor interest even as office markets face broader headwinds.
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