Banning Industrial Park Rendering
INLAND EMPIRE
BANNING, CA-The O’Donnell Group of Newport Beach, CA has broken ground on a 64-acre speculative industrial park called Banning Industrial Park that will include 12 buildings totaling over 1.2 million square feet, in this latest roundup of commercial real estate news in the West. The development site is at Ramsey and Hathaway streets, just off the 10 Freeway and near the 60 and 215 freeways, with frontage on the 10. The centerpiece of the development will be a 786,000-square-foot cross-dock distribution building that will be LEED certified, featuring a 30’ ceiling clearance height, an ESFR sprinkler system, large truck courts, abundant trailer storage and freeway visibility. Douglas O’Donnell, CEO of the O’Donnell Group, commented on the project in an announcement: "We feel that our market timing couldn’t be better. Overall vacancy in the Greater Los Angeles area is right above 4%, and there is nominal new construction on the horizon. There is a limited supply of industrial properties over 500,000 square feet available for lease or sale in the Inland Empire. At the same time, there is very strong user demand." O'Donnell's observations are borne out by the latest market reports from major brokerage firms, including CB Richard Ellis, which stated that the availability level for buildings 500,000 square feet and greater was down to 5.6% in the first quarter of this year from 7.8% in the previous quarter. "With very little supply remaining for buildings above 500,000 square feet, the Inland Empire should start to see more development for buildings this size," the CBRE report stated. "Due to the tightening supply, developers are starting to underwrite and purchase land for speculative building." The development team for the O'Donnell project includes Westling and Associates, KPRS Construction Co., Hill Pinkert Architects, Stantec and a marketing team from CB Richard Ellis including David Consani, Jim Koenig and Darla Longo. The new industrial park is slated to be ready for tenants in the fall of 2011.
Taylored Services, a supply chain and logistics management solutions provider, has signed a 203,000-square-foot lease at 14211 Monte Vista Ave. in Chino, an expansion that accommodates the company's continuing growth and increases its presence to approximately 700,000 square feet in the local market. Taylor was represented by Tim Pimentel, Chuck Belden and Kyle Kehner of Cushman & Wakefield’s Inland Empire industrial brokerage team. East Group Properties, which owns the property, was represented by Chris Brandt, Sam Foster and Mike Fowler of Jones Lang LaSalle. Pimentel said that despite a vacancy rate of 6.4% in the Chino submarket that remains among the lowest in the Inland Empire, rental rates are still off peak. "Companies today can secure deals at about 15% to 20% in Chino below what they would have paid in 2007," Pimentel said. “This may be short-lived,” he added. “Many tenants, like Taylored Services, are expanding. Others, who may have priced out of the market, are migrating back toward the coast. As available space gets tighter, rents will begin to rise."
Lucas Oil Products Inc. has signed a five-year lease for a 33,000-square-foot industrial property at 510 N. Sheridan St. in Corona that expands its US headquarters from 72,000 square feet to approximately 105,000 square feet. Lucas was represented by Ryan Moore, Mitch Zehner, and Seth Davenport of Voit Real Estate Services’ Zehner Group. The other Lucas space is at 302 N. Sheridan St. The landlord, Haralambos Leasing Co., was represented by Tal Sigler of Daum Commercial Real Estate Services.
ORANGE COUNTY
Garden Grove Walgreens
A 14,0000-square-foot Walgreens on a 55,040-square-foot parcel at 12001 Euclid St. in Garden Grove, at the signalized corner of Chapman Avenue and Euclid Street, has sold for $6.75 million in a transaction negotiated by Chris Rodriguez and Jon Selznick of Irvine-based Pacific Commercial Investments, who represented both parties. The buyer was IPX as qualified intermediary for TIS Equities VIII LLC, and the seller was a private investor based in Los Angeles. Walgreens is on a lease that runs until April 30, 2029 with scheduled rent increases. The property is part of a Ralphs grocery-anchored center. Rodriguez and Selznick note that this is one of the few, rare infill Orange County Walgreen's locations.
Bakersfield CVS
Passco Companies LLC has acquired four CVS stores in California and Texas in sale-leaseback deals. All four are newly constructed and recently opened by CVS, typical of the prototype for newer CVS retail/pharmacy stores. These features include drive-thru pharmacies, pick up stations, integration of CVS merchandise plans with interior design, and exterior signage modified to meet local ordinances. Three of the stores are located in rapidly-growing Texas suburbs, two near Austin and one near Fort Worth. The fourth store is located in Bakersfield, CA.
SEATTLE
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Kent West Corporate Park
DEXUS Property Group signed Forward Air Corp. to a five-year, 47,025-square-foot lease renewal at 6531 S. 219th St. in Kent, WA in the Kent West Corporate Park. The lease commenced May 1 and is valued at more than $1.2 million. Forward Air is a provider of transportation and logistics services to the North American air cargo industry. The facility offers proximity to the Sea-Tac Airport, access to Interstate 5 and Highway 167, and key features such as dock-high and grade-level truck loading doors and a truck staging area. The lease brings occupancy to 100% at the Kent park, a 19.6-acre, 402,000-plus-square-foot project, according to Bryan Bentrott, managing director of acquisitions and leasing for DEXUS’s US office. DEXUS was represented by Brian Bruininks of the the Andover Co. Forward Air was represented by Michael Bauer of Fischer & Co.
NORTHERN CALIFORNIA
SKS Investments/Seavest Inc. acquired the 62,466-square-foot Trancas Medical Center at 1100 Trancas St. in Napa from CMLT 2008-LS1 Trancas Street Limited Partnership for $11.2 million. The seller was represented by CBRE East Bay Private Client Group's Kathy Kelleher and Conor Deal. John Smelter, senior director of Marcus & Millichap’s Healthcare Real Estate Group in San Diego, represented the buyer. “This was a unique opportunity to acquire a class B property on the campus of a very strong hospital system,” Smelter says. “The new owner plans to renovate the property, which will allow for higher occupancies in the future." The medical facility's major tenants include St. Joseph Heritage Healthcare, Napa Valley Dialysis and Redwood Regional Medical Group. The property is adjacent to the Queen of the Valley Medical Center one of Napa Counties largest medical treatment facilities.
Basin Street Properties bought five office buildings totaling 160,000 square feet on 9.5 acres at the 1.1-million-square-foot Redwood Business Park in Petaluma from SA Challenger Inc. Both the buyer and the seller were represented by SVP Cherie Huillade and senior associate Mark Hinkins of the Grubb & Ellis Co. Private Capital Markets Group. The building addresses and their sizes were 1301 Redwood Way, 28,860 square feet; 1310 Redwood Way, 57,587 square feet; 1318 Redwood Way, 35,076 square feet; 1415 N. McDowell Blvd., 31,035 square feet; 1485 N. McDowell Blvd., 7,424 square feet. David Ford, vice president and director of management services, referred the transaction to Huillade and Hinkins.
Macerich, a shopping center REIT based in Santa Monica, bought a 75,000-square-foot Kohl's store at 1855 41st Ave. in Capitola from a partnership led by Lubert Adler Management West. The buyer and the seller were both assisted by Don LeBuhn, Philip Voorhees, Gleb Lvovich, Rick Shaffer, Trevor Thorpe and Kevin Kovar of CB Richard Ellis. The property, which is an anchor of the Capitola Mall, was occupied by Mervyn’s until its bankruptcy in 2008. Kohl’s opened for business in 2009 and has a long-term leasehold interest at the property. Macerich already owned a significant part of the Capitola Mall.
SAN DIEGO COUNTY
Roy and Helen Lee have acquired a 10,650-square-foot office building at 6035 University Ave. that will be used for a retail redevelopment, according to Mark Caston and Rick Wu of Voit Real Estate Services in San Diego, who represented the buyers. The building is 96% leased and sits on nine-tenths of an acre. The buyer also owns the contiguous property. The seller, Odom Family Trust, was represented by Tim Kerrigan of CB Richard Ellis.
A joint venture of Alliance Commercial Partners LLC and American Realty Advisors, called 4010 Ocean Ranch Venture LLC, has acquired the 203,779-square-foot former Ashworth Golf industrial building at 4010 Ocean Ranch Blvd. in the Ocean Ranch Corporate Centre in Oceanside. The property includes six acres of excess buildable land. The seller, Lloyd Wells Gift Trust, was represented by Mike Erwin of Cassidy Turley|BRE Commercial. The buyer was represented by Tucker Hohenstein of Colliers International. Hohenstein and Mike Erwin will be handling the leasing of the project.
SANTA BARBARA COUNTY
Santa Barbara-based cloud computing company RightScale has leased new corporate headquarters at 402 E. Gutierrez St., a 26,336-square-foot space that is nearly twice the size of the company’s current offices. The rapidly growing company has been headquartered at 136 W. Canon Perdido St. since early 2009. By square footage, this is the largest new office lease in downtown Santa Barbara in more than six years. It’s also one of the 20 largest new office leases on Santa Barbara County’s South Coast since 2006, according to partners Michael Martz and Steve Hayes of Hayes Commercial Group, who were engaged by RightScale to conduct a comprehensive search for a larger office space. “The emphasis was on Santa Barbara to allow RightScale to maintain its corporate headquarters in the downtown business district,” said Martz. Until now, the Santa Barbara Business & Technology Center has been the master tenant at 402 E. Gutierrez St., which served as an incubator office building, offering short-term leases for multiple spaces typically occupied by small organizations and start-ups. “In the search for large downtown office spaces, we became aware that the ownership of 402 E. Gutierrez was open to leasing to a single tenant,” Hayes said, partner at Hayes Commercial Group. “The silver lining for the small tenants who will be displaced is that the recent downturn in the economy has created numerous choices for small office tenants to consider. There will be a trickledown effect that will allow lots of small spaces to be leased up very quickly.”
LOS ANGELES COUNTY
Open Road Films, a new movie distribution company launched by Regal Entertainment and AMC Theatres, has signed a long-term headquarters lease for more than half of the 18,000-square-foot top floor at 12301 Wilshire Blvd. in Santa Monica. The property is a newly renovated building, constructed in 1976 and formerly was known as Wilshire Pacific Plaza, that was acquired in 2008 by a subsidiary of TPMC Realty Corp., a Dallas-based private equity firm that spent $5 million renovating it. Open Road, which was represented by Travis Landrum of Industry Partners, is headed by former Lionsgate and Weinstein Co. executive Tom Ortenberg. The landlord was represented by Christian Holland of Coldwell Banker Commercial Westmac.
Freight forwarding company ILS Inc. bought a 27,052-square-foot warehouse at 18618 S. Ferris Place at the Dominguez Technology Center in Rancho Dominguez for $3.4 million. The company, which will use the facility as its corporate headquarters and is scheduled to move into its new location in June, was represented by a Grubb & Ellis team including senior vice presidents Terry Reitz and Jim Biondi, along with vice president Gerald Kim.
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