SANTA ANA, CA—Private commercial real estateinvestment firm CapRock PartnersLLC has sold out the remaining 14 units ofindustrial condominiums at its South CoastMetro Business Center here. The closing represents the endof a successful redevelopment project andmarketing campaign for thevalue-add project.

|

GlobeSt.com has learned that the entire hold period for theproperty was less than two years; renovations varied per unit, withsome units extensive and others minor; and an additional buildingon excess land here was also entitled. The firm would not revealconstruction costs to GlobeSt.com.

|

The center spans two buildings at 2834-2880 FairviewSt. at the intersection with Segerstrom Ave. Beforerenovations, the space totaled approximately75,000 square feet. The CapRock investment team tracked the assetfor three years before acquiring fee interest in the high-imageindustrial complex through a receivership sale in 2012.

|

According to Pat Daniels, co-founder and CEO ofCapRock, “The sell-out of our project is powerful validation of theentrepreneurial approach to value-add industrial assets for whichwe are known. Our team's keen grasp of the market allowed us notonly to acquire this asset, but also to quickly recast it fortoday's industrial buyer and achieve returns for our investors thatsignificantly exceeded expectations.”

|

After acquiring the asset, CapRock began extensive renovationsto improve its functionality, redesigning and reconfiguring theinteriors of the buildings and removing non-functional officespace. The resulting industrial condominium units, ranging in sizefrom 2,958 square feet to 8,857 square feet, then were marketed forsale as industrial condominiums by industrial brokers LouisTomaselli and Steve Wagner ofJLL and Jim Snyder andSean Ahern of Lee &Associates.

|

“CapRock's success with SCMBC is just another testament to itsability to execute,” says Tomaselli, JLL's senior managingdirector, industrial advisory. “What's unique is that they aredoing it time and again in a competitive arena with limitedvalue-add opportunities. CapRock is quite literally addingvalue.”

|

In addition to redeveloping the asset, CapRock also completedentitlement of a 12,000-square-foot land parcel at the project,which is now in escrow. According to Jon Pharris,a principal and director of acquisitions for CapRock, “Ourexceptional relationship with principals, lenders and brokerscontinue to provide our firm with best-in-class access to assetsand deal flow. Fairview is a prime example of this competitiveedge. Our connections, coupled with our immediate access tocapital, development expertise and ourentrepreneurial approach to creating value, position us as aleading investment firm for industrial assets throughoutCalifornia.”

|

Industrial redevelopment has become a large part of theconstruction in this sector seen in Orange County due to the landconstraints and amount of industrial space that has becomeobsolete. As GlobeSt.com reported last week,distribution expansion is returning to the infillmarket, where e-commerce companies are looking toplace smaller industrial buildings in order to becloser to consumers, RickEllison, executive director with Cushman &Wakefield's industrial properties group, told us. He addedthat the tight Orange County industrial market that is also landconstrained is helping fuel demand for construction of thesecenters, which will likely come from redevelopmentof existing obsolete buildings.

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Carrie Rossenfeld

Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.