Former Teva Pharmaceuticals facility was expected to fetch $50M

EBS Realty Management and a Connecticut investor have bought the former manufacturing campus for Teva Pharmaceuticals Industries in Irvine for $24 million.

The Newport Beach-based commercial investor and Penwood Real Estate Management bought the three industrial buildings at 19 Hughes Avenue, the Orange County Business Journal reported. The 6.7-acre site includes three buildings totaling 186,000 square feet, including a main building of 88,000 square feet near the south side of the Great Park.

The property was once occupied by the Tel Aviv-based pharmaceutical firm, once the second largest drugmaker in Orange County.

Last March, Teva announced plans to permanently cease manufacturing operations in Irvine.

Real estate experts had expected the industrial campus to fetch up to $50 million, given recent pricing for new industrial projects.

Patrick Remolacio, a principal with EBS, attributed the lower-than-expected price to weakened market conditions and troubled debt markets since the facilities were listed last year.

The company is weighing several options for the site in light of new market conditions.

Teva’s lease runs out in a few more months, EBS said, at which point the developer will look at redeveloping the site on a build-to-suit or speculative basis, or lease the buildings as they stand.

Redevelopment may pose a challenge because of proposed changes to Irvine’s entitlement process, according to EBS.

“The planning staff has proposed a requirement of conditional use permits for new industrial properties, which would add a considerable amount of time to the entitlement process and would be problematic to future users,” Remolacio told the Business Journal.

In 2021, the EBS-Penwood venture bought the former LT Platinum site next to Angel Stadium at 2030 South State College Boulevard for $43.8 million. The site, once eyed for a mixed-use high-rise development, has a 100,000-square-foot warehouse leased through early next year.

In 2019, the Newport Beach firm bought a 95,000-square-foot industrial building at 14192 Franklin Avenue in Tustin for nearly $20 million. The next year, it leased it to Rivian Automotive, an electric vehicle company based a few blocks away.

A new industrial project near Nellis Air Force Base landed a tenant that says it will supply luxury suites for Las Vegas’ upcoming Formula One race.

Illinois-based InProduction, which provides temporary seating, staging and the like for events, leased a newly built warehouse that spans more than 102,000 square feet, brokerage firm Cushman & Wakefield announced this week.

Cushman represented the tenant, which expects to occupy the building, near the intersection of Lamb Boulevard and Cheyenne Avenue in the northeast Las Vegas Valley, next month.

InProduction President and CEO Jason Tedrow confirmed to the Review-Journal his firm is moving there from a smaller industrial space a few miles away.

“We need to expand our operation in Vegas,” he said, noting America’s casino capital is a major entertainment hub with lots of big events.

He said that the company is providing several “multi-level hospitality structures” for the F1 race and that they’re more like luxury suites. For the most part, they will be along Koval Lane just east of the Strip.

A spokeswoman for F1 owner Liberty Media Corp. did not respond to a request for comment.

Scheduled for Nov. 16-18, Las Vegas’ Formula One race is poised to draw huge crowds. The 3.8-mile route will include a stretch of the Strip, and drivers are expected to reach speeds of more than 200 mph.

Casino chain Caesars Entertainment Inc. unveiled a $5 million VIP “Emperor Package” for the race that includes five nights in a villa with views of the track.

MGM Resorts International announced it will build grandstands in front of Bellagio’s iconic fountains for the event.

“Access to these epic seats is currently only available as part of MGM Resorts’ race-and-stay packages,” the casino giant said in a news release.

The race is expected to produce a windfall of spending in Las Vegas, with almost $1.3 billion in total economic impact, according to an announcement Monday from Las Vegas Grand Prix CEO Renee Wilm.

InProduction, for its part, locked up a new warehouse amid strong demand for distribution space in Southern Nevada. The local industrial market’s vacancy rate was a record-low 1.3 percent in the third quarter last year, brokerage Colliers International reported.

Developer EBS Realty Partners broke ground on the northeast valley project last May without a user lined up first, a common approach to warehouse development in Southern Nevada. It finalized a lease with InProduction last month, EBS founder and managing principal Quinn Johnson told the Review-Journal.

“We had a lot of tenant activity on it,” he said.