Denver

Michael Cantwell, managing director of Johnson Capital’s Denver office, has arranged $23.6 million in financing for the owner of a multi-state portfolio of ground leases underneath four office buildings. The ground leases are owned by affiliates of Aardex LLC, which developed the properties and subsequently sold leasehold interests to third-party investors. Each property is subject to a 99-year ground lease. Three of the office buildings are leased to the General Services Administration. One of those is located in New Mexico, and the other two are in California. The fourth office building is located in Lakewood, CO, and is fully occupied by two credit tenants, Gambro and CaridianBCT, which are both medical equipment manufacturing companies. Goldman Sachs was the lender on this conduit deal, which Johnson Capital reports is one of the first conduit deals completed since 2008. The 10-year note has a 30- year amortization schedule and a loan to value ratio of 75%. The Colorado property is called Signature Center and it is located in the Denver West Office Park. It contains 183,500 square feet in five stories plus structured parking and was built in 2008 at the Denver West Parkway and I-70 intersection.  Upon completion, it was only the second Double LEED Platinum building in the world. The New Mexico property is located at 555 Broadway in Albuquerque and contains 33,328 square feet. It was completed in 2003 and is located in the central business district. The California properties are located in downtown Fresno and Perris. The Fresno property is leased to the Federal Government and it houses courtrooms and judicial offices in 126,347 square feet. It is located at 1950 G St. The Perris property is located at 23123 Cajalco and it contains 183,194 square feet. It houses the National Archives and Records Administration. Commenting on the debt placement, Cantwell says that “What appeared to be a quick and easy transaction on the surface turned into a very detailed and complex financing. Goldman Sachs did a thorough job and as the complexity grew, they continued to find a way to make the deal.”

Orange County

Century City,CA-based Pegasus Investments, as exclusive adviser to Moorpark Associates LLC,  has closed on a 70% vacant multi-tenant retail shopping center in Fullerton, CA, according to president Ken Chasin and vice president David Chasin of Pegasus. The property had been acquired in 2007 when it was 100% occupied with tenants paying average rental rates of $2.25 per square foot NNN. At the time of the sale, average retail rental rates had fallen almost in half, according to David Chasin. The property closed at a sales price of $1.6 million, a cap rate of 5.5% and $124 per square foot. The seller was represented by the Chasins. The buyer, a private syndicator based in Orange County, was not represented by a broker. "The sale of this property tells the story that even highly sought after, Orange County retail properties can be challenging," David Chasin commented. "When the property was purchased back in '07, rents were only $2.25 per square foot, which wasn't excessive at all for L-shaped retail in Orange County," Chasin added. "However, the management team in place was caught off-guard by the persistent requests for rent relief and ultimately found itself asking the question whether to try to salvage the deal or cut its losses and move on." The property is located along E Orangethorpe Avenue in the city of Fullerton near the junction of the 57 and 91 freeways. It benefitted from strong traffic counts along East Orangethorpe, a strong daytime population and favorable parking and access. One of the drawbacks of the center was its mid-block location. "Despite the 20-plus offers our firm received on the asset, many investors couldn't overlook the fact that it was not on the hard corner and that it was located in a predominantly office and industrial area," Chasin said. Pegasus is currently advising the seller on two other under-performing assets: Peninsula Plaza, a 41,000-square foot, 65% occupied value-added retail and office property located in a prime area of Palos Verdes and Sherman Way Retail Shops, a 14,000-square-foot retail center which is currently 90% vacant. "This particular client, an L.A.-based private investment company, has decided to shed its management-intensive, underperforming assets and use the proceeds to purchase single tenant net-leased properties out of state," Chasin added. “This strategy will create value by locking in yields with favorable long-term financing on credit tenant-leased properties."

Real estate brokerage 360 Commercial Partners industrial advisory group has represented the buyer of a 27,731 square-foot industrial building located at 5702 Bolsa Ave. in Huntington Beach. The sale transaction represents the largest (in square footage) industrial building sale in Huntington Beach to-date this year. Through the deal, 360 Commercial Partners achieved their client’s objectives—keeping H-Wave (manufacturers of electro-therapeutic treatment devices) in Huntington Beach. In addition, the 360 Commercial Partners’ industrial advisory group delivered further value to H-Wave, performing a strategic own vs. lease analysis that proved purchasing was the right option for the client. “We were pleased to assist H-Wave in securing the most commercial real estate value for their dollar, while also leveraging attractive SBA financing,” says Steve Wagner, associate director of 360 Commercial Partners’ industrial advisory and the lead broker on the sale. “This made the decision easy for our client to purchase, instead of lease.”

Los Angeles

Albert Shilton of Charles Dunn Co.’s West Los Angeles office negotiated the sale of two Los Angeles-area apartment complexes located in Studio City and North Hollywood totaling $11.4 million. Shilton oversaw the $6.8 million sale of the Orion, located at 4176 Arch Dr. in Studio City, CA, as well as the $4.6 million sale of the Vista Villas Apartments at 4215 Vineland Ave., in North Hollywood, Calif. Shilton represented the Orion’s new owner, Studio City Mid Rise Apartment LLC. The 42,196-square-foot, 52-unit complex was built in 1963 and is currently 92% occupied. The seller, the Hurley Family Trust, was represented by CB Richard Ellis’ Laurie Lustig-Bower. City Walk Apartments, LLC, an entity owned by the same buyer, also purchased the Vista Villas Apartments from the Hurley Family Trust. The 28,494-square-foot, circa-1962 building has 33 units that are currently 94% leased. Shilton represented both the buyer and the seller. “These properties were under contract at full price within days of being listed,” Shilton says. “This was an astute buyer. He knew that this was a rare opportunity to buy two good sized properties in a prime area and did so quickly.”

Hirsch Sherman and Jared M. Levine of KW Commercial represented the seller in the disposition of 4930 Coldwater Canyon Ave. in Sherman Oaks, known as Villa Sabrina. Villa Sabrina is a 32-unit apartment complex of approximately 22,524 square feet. It was built in 1977 with a unit mix of singles, one- and two-bedroom units with some loft-style units on an approximately 35,837-square-foot lot. The brokers note that this was not a distressed sale, it was an off-market deal between two private multifamily investment operators in which the buyer acquired the property cash to existing (Fannie Mae) loan. 

Cupertino Electric Inc. leased 25,110 square feet of industrial space for five years at 10240 Matern Place, Santa Fe Springs, from Jacobs Family Trust. Greg Osborne and Jeff Read of Grubb & Ellis’ Anaheim office represented the lessee in the transaction. Luke McDaniel of Voit Commercial Brokerage LP represented the lessor.

Seattle
West Living, an investment firm specializing in senior housing has completed a $12.8 million minority investment in the Bellettini, a 145-unit independent and assisted living community in the prestigious downtown area of Bellevue, WA, just outside of Seattle. Lytle Enterprises, the developer of the Bellettini has owned and developed senior housing communities for over 30 years. “We are very pleased that West Living shares our vision for the Bellettini and we look forward to their partnership to enhance our first class senior community,” says Chuck Lytle, president of Lytle Enterprises. 

Eugene, OR

Equitas Investments LLC purchased a single tenant, NNN, 7-Eleven in Eugene, OR.  It was an all cash transaction with a short escrow timeline. Equitas Investments founder, Aaron Swerdlow says, “The acquisition represents our continuing motivation to purchase stabile, core, single tenant, NNN assets that provide long term passive income with NOI growth.  In addition to stabile, single tenant properties, we also purchase land, and value add retail through our affiliate company, Equitas Value Co.”

Inland Empire

The Magellan Group has acquired two industrial buildings in the Hunter Business Park in Riverside, CA. The buildings are part of a 31-acre, three-parcel purchase in a venture between the firm’s Magellan Industrial Fund and an investment fund managed by Penwood Real Estate Investment Management. The acquisition includes a 300,000-square-foot manufacturing facility located at 800 Iowa Ave. that is the former Lily-Tulip Cup plant. The purchase also includes a leased 100,000-square-foot industrial building that is occupied by Ancon Marine and a 1.75-acre land parcel at the corner of Iowa Avenue and Palmyrita Avenue that is slated for future development or sale. “This purchase fits within our strategy of acquiring older industrial properties throughout Southern California and selected other Western markets where we can add value through property upgrades, leasing, management and disposition,” says Kevin Staley, principal and co-founder of the Magellan Group. The venture acquired title to the properties following its purchase of an underlying mortgage note held by Far East National Bank. Terms of the sale were not disclosed. The venture closed on the acquisition in less than 30 days. Magellan’s ability to underwrite and close complicated transactions with speed and certainty has been integral to its success, according to a prepared statement.

San Francisco

Storage Mobility has signed a lease for 45,000 square feet at 5000 Park Rd. in Benicia. The property, which has 30-foot clear high ceilings making it ideal for PODS storage, will be used to store PODS for use throughout Contra Costa, Solano, Sonoma, Napa and Marin Counties. The landlord is Sand Hill Advisors, led by Bert Sandel and Al Hill. Jason Ovadia and Kevin Ahaesy of Jones Lang LaSalle’s Northern California industrial & logistics team, based in Walnut Creek, represented the Storage Mobility.