Insignia Wins Key EOP Management Contract

LOS ANGELES-Insignia/ESG Inc. has won a key, 1.4-million-sf management and leasing contract for some of the industrial and office buildings that Equity Office Properties recently acquired through its $7.3-billion purchase of fellow REIT Spieker Properties Inc.

All of the buildings covered by the new Insignia-EOP contract are in San Diego County and the Inland Empire. They include Pacific Ridge Corporate Center and La Place Court in San Diego, as well as the Inland Empire’s One Lakeshore Center, Ontario Corporate Center and Empire Corporate Center.

Winning the contract is key for Insignia in many ways. Though the company’s 65-million-sf West Coast property-management portfolio is among the largest in the region, the firm has been trying to build more market-share in San Diego and the Inland Empire—two areas where it does not enjoy the dominance it has in Orange County, the Silicon Valley or Phoenix.

In winning the pact, Insignia also beat-out some of its toughest competitors. And since Equity Office officials have suggested that they might sell off some or all of Spieker’s industrial holdings because they don’t really fit into EOP’s portfolio, Insignia could well find itself with some prime for-sale listings soon.

The new contract “corresponds directly with our strategy to associate with the highest-profile properties and ownership companies on the West Coast,” says Dave Pogue, executive managing director of property services in Insignia’s Western Region.

Chicago-based Equity Office’s acquisition of Menlo Park-based Spieker closed earlier this month, after gaining approval from about 82% of EOP’s shareholders and 74% of Spieker’s public investors. Even before the merger was completed, EOP’s 99-million-sf office portfolio in 380 buildings across the US made it the nation’s largest publicly held office owner and manager. The Spieker acquisition added another 25 million sf of office space and 13 million of industrial space, virtually all of it in California and the Northwest.