Property Types
Industrial
Jul 16, 2009
By: Tonie Auer, Contributing Correspondent
Despite sale and lease activity in the Los Angeles industrial market well off from just a year ago, Westcore Properties and Dune Real Estate Fund II have purchased a seven-building portfolio containing more than 760,000 square feet of L.A.-area industrial properties.
The portfolio is comprised of properties located in the cities of Commerce and Buena Park, and was acquired by Dune-Westcore GBP L.L.C., a partnership of Westcore and Dune Real Estate Fund II. The seller Prudential Real Estate Investors, acting on behalf of institutional investors.
The buildings are 98 percent occupied and house 18 tenants including Hilti, Inc., US Healthworks, JAM-N-Logistics, Malarkey Roofing, Golden Orchid, ENL Global, Legacy Farms, Fresh Food Concepts, Inc. and Blue Line Foodservice Distribution. The portfolio consists of two projects. The first is the Garfield Business Center, a 545,300-square-foot warehouse business park located in Commerce. The second is the Commerce Centre at Buena Park, a 224,600-square-foot cold storage industrial complex in Buena Park.
The acquisition includes “prime, infill Southern California industrial properties with proximity to the world's first and second largest container terminals located in Los Angeles and Long Beach,” one of the buyers said in a prepared statement.
The acquisition may be one of the keys to helping re-energize the Los Angeles industrial market and restoring the faith of users and investors. For now, the balance will likely continue to swing in favor of the buyer/tenant as they are increasingly being enticed by lower rates for better products, according to a first quarter report by Grubb & Ellis Co.
However, despite the lower prices, the market continues to contract, posting more than 3.5 million square feet of negative net absorption in the first quarter, according to the Grubb & Ellis figures. That was the largest amount of negative net absorption in well more than five years, the report said. Average asking rates continued to tumble, down 5 percent from the previous quarter and 11 percent over the same period last year.
Available sublease space has also increased 12 percent over prior quarter and is up 44 percent over last year. Due to the economic uncertainty, many businesses are being forced to contract, and therefore put space up for sublease, or put there expansion plans on hold until the economy finds its footing, Grubb & Ellis stated.
By: Tonie Auer, Contributing Correspondent
Despite sale and lease activity in the Los Angeles industrial market well off from just a year ago, Westcore Properties and Dune Real Estate Fund II have purchased a seven-building portfolio containing more than 760,000 square feet of L.A.-area industrial properties.
The portfolio is comprised of properties located in the cities of Commerce and Buena Park, and was acquired by Dune-Westcore GBP L.L.C., a partnership of Westcore and Dune Real Estate Fund II. The seller Prudential Real Estate Investors, acting on behalf of institutional investors.
The buildings are 98 percent occupied and house 18 tenants including Hilti, Inc., US Healthworks, JAM-N-Logistics, Malarkey Roofing, Golden Orchid, ENL Global, Legacy Farms, Fresh Food Concepts, Inc. and Blue Line Foodservice Distribution. The portfolio consists of two projects. The first is the Garfield Business Center, a 545,300-square-foot warehouse business park located in Commerce. The second is the Commerce Centre at Buena Park, a 224,600-square-foot cold storage industrial complex in Buena Park.
The acquisition includes “prime, infill Southern California industrial properties with proximity to the world's first and second largest container terminals located in Los Angeles and Long Beach,” one of the buyers said in a prepared statement.
The acquisition may be one of the keys to helping re-energize the Los Angeles industrial market and restoring the faith of users and investors. For now, the balance will likely continue to swing in favor of the buyer/tenant as they are increasingly being enticed by lower rates for better products, according to a first quarter report by Grubb & Ellis Co.
However, despite the lower prices, the market continues to contract, posting more than 3.5 million square feet of negative net absorption in the first quarter, according to the Grubb & Ellis figures. That was the largest amount of negative net absorption in well more than five years, the report said. Average asking rates continued to tumble, down 5 percent from the previous quarter and 11 percent over the same period last year.
Available sublease space has also increased 12 percent over prior quarter and is up 44 percent over last year. Due to the economic uncertainty, many businesses are being forced to contract, and therefore put space up for sublease, or put there expansion plans on hold until the economy finds its footing, Grubb & Ellis stated.
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