UNITED STATES - ING Clarion Partners and Panattoni Development Company have formed a joint venture to redevelop a former Boeing Company site as a major mixed-use project in Anaheim, California.

Officials at ING Clarion - which is the majority shareholder - say it contributed capital to the asset for an offshore foreign capital source, and they are aware of the current state of the office market where the $350m (€239.1m) project is located.

The property totals 102-acres and will be transferred into a 148,640m2 space, split as a mixture of 40% industrial, 50% office and 10% retail, according to Mike McCann, senior vice president for ING Clarion.

"We have seen that the office vacancies in Orange County have dropped from 7- 8% a year ago to 11% now. But we do like the market on a long-term basis," said McCann.

According to ING, several different types of tenants are now cutting way back on their space needs, including title insurance companies, brokerage houses and either flooring, furniture and appliance companies.

However, the firm believes the industrial market in Orange County remains very strong and says vacancies are in the low single digits because there is very little new supply of property coming on line.

The project as it stands has 14 separate existing buildings totaling 139,350m2 of office, warehouse and R&D facilities so the plan for the project is around 41,805m2 of office to be retained and upgraded while the balance of the existing assets will be demolished to make way for a newer generation of properties available for either sale or lease.

The venture plans to build around 111,480m2 of modern LEED-certified buildings and the new industrial buildings will be either warehouse/distribution or light manufacturing facilities, ranging in size from 1,858m to 3,716 m2.

Retail elements of the new project will be service retail, to serve the needs of the tenants who become part of the completed development.