A joint venture between Archer Property Partners and Real Estate Development Associates has acquired the 78,000-square-foot office building at 3300 Irvine Ave. in Newport Beach, with plans to transform it into a state-of-the-art medical outpatient building.
The partnership received unanimous approval from the Newport Beach Planning Commission in January 2025 and is now moving full speed ahead with the project.
Newport Irvine Medical Center, as it will be known, is a three-story building located just off State Route 73 in Newport Beach. Originally developed by The Koll Company in 1980, the building has long served as a general office space. However, with the continued decline in demand for traditional office space since the pandemic, the new ownership is converting the property to what it sees as its highest and best use: a modern medical office facility.
“Newport Beach is one of the most sought-after locations for medical office space in Southern California,” said R.J. Sommerdyke, principal at Archer. “Medical office vacancy in the city is exceptionally low — less than 5 percent — with a severe lack of large blocks of contiguous space. Currently, there is only one space larger than 10,000 square feet available citywide. Many existing MOBs are aging and no longer meet the needs of today’s providers, making redevelopment projects like this essential.”
In addition to these strong fundamentals, Newport Beach’s medical office market is being reshaped by intensifying competition between major health systems. Hoag and UC Irvine Health are aggressively expanding their presence, each vying for market share in one of the region’s most affluent healthcare markets. Hoag recently announced plans to expand its specialty care services, while UC Irvine is investing $1.3 billion in a new medical complex in Irvine.
This race for expansion is driving heightened demand for high-quality, well-located medical office space, especially as private physician groups weigh their options between affiliating with these growing institutions or remaining independent in an increasingly consolidated healthcare landscape.
Rising rental rates further highlight the tight market conditions. Since the partnership first explored acquiring the property, medical office rental rates have increased by over 10 percent, driven by strong demand from healthcare providers.
Newport Beach’s three newest medical office developments — The Walk (anchored by MemorialCare), Newport Harbor Medical Plaza (anchored by USC Keck), and Newport Heights Medical Campus (anchored by UCI Health) — are all fully leased, underscoring the intense demand and limited availability of premium medical space in the area.
“We identified this property before the pandemic and immediately recognized its exceptional potential based on its location, size, and construction type,” said Jason Krotts, principal at REDA. “We remained patient and ultimately acquired the building at the right price. Now, with medical space even tighter, this conversion is well-positioned for success.”
The partnership’s principals previously collaborated on the neighboring Newport Heights Medical Campus, a speculative ground-up development. Their success with that project reinforces their confidence in the demand for purpose-built medical facilities at this location.
Newport Irvine Medical Center will be comprehensively reimagined to support a wide range of healthcare providers, from specialty practices to wellness services.
Groundbreaking is scheduled for June 2025, with project completion anticipated for Spring 2026.
MedWest Realty, Inc., a leading healthcare real estate brokerage and advisory firm, has been retained to handle the leasing of Newport Irvine Medical Center. For more information, visit MedWestRealty.com.
