Four of the top five industrial sales last month
With persistent demand from e-commerce, distribution companies and data centers, industrial properties continue to command big closing prices.
In April, developers and investment firms spent about $270.8 million combined on the top five largest deals. An investment trust for Rexford Industrial Realty scored two of the top three sales, continuing its own streak of acquisitions in Southern California.
And with a super tight market in the city of L.A., it was further out in places like City of Industry and the San Fernando Valley, where the large acquisitions took place, with home-grown players making up the lion’s share of the buyers.
1. 1145 Arroyo Street — Rexford Industrial REIT | $118.1 million
Rexford Industrial REIT, one of the most active industrial investors in L.A., continued its buying spree this year by purchasing the San Fernando Business Center for $118.1 million in an off-market transaction.
The property includes five buildings over nearly 29 acres at 1145 Arroyo Street in the city of San Fernando. About 88 percent of the space is occupied at below-market rents. Some buildings are also along Aviation Place and 8th Street.
The seller was Connecticut-based Barings Real Estate, an investment wing of the Massachusetts Mutual Life Insurance Company. The deal closed at about $200 per square foot. Rexford, which is based in Brentwood, plans to improve the properties and secure higher rents.
Last year, Rexford spent about $500 million on more than a dozen industrial properties.
2. 15250 Desman Road — Robertson Properties Group | $52.9 million
Robertson Properties Group picked up a 250,000-square-foot warehouse in La Mirada for $52.9 million.
The tenants at 15250 Desman Road include All-Ways Inc., an international shipping and logistics firm, and Veritiv, a paper packaging and warehousing company.
Seller AEW Capital Management, which closed the deal on April 4, has had a busy year so far. In March, an entity tied to AEW purchased a 10-acre retail plaza near San Bernardino for $49.2 million — a record for the submarket there. The DTLA-based firm also purchased a shopping plaza in Claremont for $13.8 million in February.
3. 13890 East Nelson Avenue — Rexford Industrial REIT | $41.8 million
Earlier in April Rexford paid $84.5 million for four industrial sites, totaling 456,000 square feet. The largest parcel in the sale, a 257,000-square-foot property at 13890 East Nelson Avenue in the City of Industry, traded for $41.8 million.
The entity that sold the property is connected to Colony Capital. The three other properties sold in the transaction are locsouth of Los Angeles County, in Orange, Carlsbad and San Marcos.
Earlier in the month, Rexford separately purchased a 200,000-square-foot warehouse near DTLA, and in January it purchased another warehouse in Industry for $19.5 million.
The City of Industry has been one of the hottest industrial property markets in the region.
For example, merchandising company Max Sales Group acquired its future 64,000-square-foot headquarters for $11.5 million at 15240-15250 Nelson Avenue. A few days prior, transportation firm Soho Logistics signed a seven-year lease worth $11.2 million for 168,900 square feet at 14736 Nelson Avenue.
4a. 22020 Recreation Road — Trophy Automotive Dealer Group | $29 million
Trophy Automotive Dealer Group purchased a 72,000-square-foot car dealership at 22020 Recreation Road in the city of Carson for $29 million.
The property, built in 2017, was home to the Kia dealership with the highest sales volume in the country as of last summer. Glendale-based Trophy Automotive owns six dealerships in Southern California, according to Automotive News.
The Real Deal reported that the dealership could be tied to the scandal surrounding former Nissan chairman Carlos Ghosn. Nissan was reviewing Trophy because CEO Nasser Watar is a partner of Sheikh Khaled Al Juffali, who Japanese prosecutors allege was a part in a Ghosn-led scheme to shift personal debts to Nissan. Watar and Al Juffali jointly run Al-Dahana, a Middle-Eastern auto seller that owns Nissan Gulf. Trophy maintains that it has no connection to the larger scandal.
The sale in Carson is above what other car dealerships having recently been trading for in L.A.. Three West Covina dealerships owned by Roger Penske, Jr., sold for a combined $61.2 million earlier this year.
4b. 3318 La Cienega Place — Redcar Properties | $29 million
Redcar Properties purchased a warehouse from Carmel Partners for $29 million.
The 30,400-square-foot property was bought by an entity controlled by Jim Jacobsen, CEO and chairman of Redcar Properties. It’s located on a 1.3-acre property at 3318 La Cienega Place in the West Adams neighborhood Los Angeles. Deutsche Bank provided a $17.4-million-dollar acquisition loan for the deal.
The seller is Carmel Partners, which is building the massive Cumulus mixed-use project next door. The San Francisco-based company had paid $14 million for the Redcar property in 2017.
The neighborhood has attracted an increasing amount development due in part to the Metro Expo Line expansion, having recently seen a jump in residents, office tenants and retailers, as well as investors. Earlier this year, Redcar Properties applied for permits with the city to build a four-story retail and creative office project nearby on West Adams Boulevard. CIM Group is also planning a mixed-use project on West Adams Boulevard, as well as a hotel and media building nearby.