Employment activity in the Southwest market picked up this week after lackluster new hiring announcements for the last two weeks. Overall, sales and leasing activity, however, seemed slower for the week, likely due to the usual summer slow down. While July and August tend to be the slow time for the year, many experts are reporting increased activity throughout the Southwest, especially near the coast. This week, investment activity spanned real estate asset classes, while leasing activity seemed to focus on smaller office spaces. Interestingly, a second quarter report from Colliers International showed that industrial vacancy ticked up in the Central Los Angeles market. This is a surprise, considering the L.A. market is one of the tightest in the country. For more news, here's a look at this week's trends, announcements and deals that you may have missed in Southern California, Utah, Arizona and Nevada.

BY THE NUMBERS

In the 2Q17, the industrial vacancy rate in the Central Los Angeles industrial market actually increased. The overall vacancy rate was 1.5% for the quarter, an increase of 20 basis points from the previous quarter with net absorption totaling -327,800 square feet. This increase was the result of several large move outs this quarter. Despite the boost in vacancy, asking rental rates held steady at $0.65 PSF NNN. This is the highest rate ever recorded, and much of the gain in asking rents has been seen in the infill Central Los Angeles submarket. Sales and leasing activity totaled 2,127,800 square feet.

(SOURCE: COLLIERS INTERNATIONAL)

NEW & NOTABLE

IRVINE, CA—Duke Realty Corp., a leading nationwide REIT has hired Jonathan Bagnall as Vice President of Construction. In his position, Bagnall will oversee all aspects of the Southern California office's construction operations, including preconstruction, project management and day-to-day site operations, as well as construction personnel. Bagnall has worked for several large construction companies in business development and construction oversight roles. He is a member of NAIOP's Southern California and Inland Empire Chapters.

SAN DIEGO, CA—NorthMarq Capital has hired Conor Freeman as VP. In his new role at NorthMarq, Freeman will be responsible for providing clients with creative solutions through NorthMarq's life insurance relationships, Fannie Mae, Freddie Mac, FHA/HUD, CMBS lenders, debt funds, banks and credit unions. Freeman comes to the San Diego team after serving as the Director of Capital Markets for a boutique mortgage banking firm, where in 2 ½ years he originated over $200 million in transactions in core, secondary, and tertiary markets nationwide, involving commercial and multifamily asset classes. Freeman earned his bachelor's degree from San Diego State University.

LOS ANGELES, CA—Matthews Real Estate Investment Services has hired Daniel Withers as SVP of multifamily business. Bringing over 17 years of experience in the industry, Withers will contribute to the strategic expansion of the Matthews footprint. Withers previously served as the director of multifamily for Berkadia, where he primarily focused on multifamily investment sales and advisory amongst the greater Los Angeles County marketplace. Before working with Berkadia, he was a VP at Marcus & Millichap. During his tenure in the industry, Withers has been responsible for successfully closing just north of a billion dollars in sales volume which comprised of existing multifamily investments and ground-up development sites.

PHOENIX—W&W Structural has added Bobby Esmilla as a senior estimator to its growing team in its Tempe office. Esmilla will be responsible for estimating and material take-off for complete steel bid packages. A native of Manila, Philippines, Esmilla previously worked at Ironco Enterprises, Senior Estimator; Maricopa Metals, Chief Estimator; and Schuff Steel, Detailer/Estimator.

DEALTRACKER

NEWPORT BEACH, CA—The Orange County Medical Association has purchased an 8,058-square-foot, freestanding, office building in the Newport Corporate Plaza for $3.2 million from Kearny Real Estate. The building is located at 5000 Campus Drive, Newport Beach. Principal Marshal Vogt of the Orange office of Lee & Associates, the largest broker-owned commercial real estate firm in North America, represented the Orange County Medical Association and Joe Winkelman of Colliers represented the seller.

BAKERSFIELD, CA—Riverlakes Village, a 92,212-square-foot grocery-anchored shopping center in the city of Bakersfield has traded hands. The neighborhood shopping center is 97% and is anchored by Vons and has a mix of high performing tenants, including CVS/pharmacy, US Bank, Starbucks, Chipotle, Supercuts, Verizon Wireless, Carl's Jr., and Bank of America. CBRE EVP Philip D. Voorhees and SVPs Preston Fetrow and Kirk Brummer, along with Jimmy Slusher, Megan Wood, Matt Burson, Sean Heitzler, James Tyrrell and John Read, represented the seller, Crow Holdings Capital Real Estate (CHC-RE), a Dallas-based manager of private real estate funds. The buyer was Phillips Edison Grocery Center REIT II.

LAS VEGAS—Veritas Apartments in the Las Vegas suburb of Henderson, Nevada, has traded hands between Monogram Residential Trust and Farnam Realty. JLL EVPs John Cunningham and Charles Steele led the JLL team on the sale. The property was completed in 2010 and has a mix of one-, two- and three-bedroom units. The building features four swimming pools, a covered patio with an outdoor kitchen, barbecue grills, a fitness center with a yoga room, and a clubhouse with gaming room and cyber café.

Los Angeles, CA—Towne Industry has purchased a 58,859 square foot industrial property, located at 621 & 701 East 7th Street, 650 & 655 Crocker, and 649 Towne in Los Angeles California in Los Angeles, California, for $10.6 million. Kidder Mathews commercial real estate brokers Jon Reno, SIOR, CCIM, William Morrison, SIOR, and Tom Williams represented the buyer in the deal.

SAN DIEGO, CA—Stos Partners has acquired a 170,805 square-foot two building multi-tenant industrial project in Chula Vista, California. The property, which was acquired off-market, is widely considered desirable by private and institutional investors due to its size, location and mix of local and national tenants from many industries. The project is currently 100% occupied by a mix of local and national credit tenants in various industries, including manufacturing, medical supply and distribution, as well as defense.

IRVINE, CA—Faris Lee Investments has completed the $13.5 million sale of a 24,130-square-foot freestanding retail property triple-net leased to CVS/Pharmacy in Norwalk. Nicholas Coo, senior managing director, and Joseph Chichester, director with Faris Lee Investments represented the 1031 exchange buyer, Nasa Norwalk Center Enterprises, LLC from south Orange County. Donald MacLellan, senior managing partner with Faris Lee Investments represented the seller, WMG-CGI Norwalk from Scottsdale, Ariz. The closing cap rate was 4.6%, the lowest cap rate for a CVS Pharmacy sale in 2017 nationwide.

LOS ANGELES—Capital One has provided a $25.6 million Fannie Mae flexible-rate loan for the acquisition of Woodley Apartments, a 126-unit apartment community in Van Nuys, California. The sponsor, the Kort and Scott Financial Group, is the 13th largest owner and operator of manufactured housing communities in the country. This is the group's 37th transaction with Capital One. SVP Chad Thomas Hagwood originated the transaction. The 10-year flexible-rate loan has six years of interest-only payments followed by amortization on a 30-year schedule.

PHOENIX—James DuMars, SVP/managing director of NorthMarq Capital's Phoenix regional office, negotiated the $42 million acquisition financing of Veritas Apartments, a 430-unit class “A” multifamily project located at 3370 St. Rose Parkway in Henderson, Nevada. The transaction was structured with a full 10-year term, interest-only loan. NorthMarq arranged financing for the borrower through its Fannie Mae DUS division of NorthMarq Capital Finance.

BUILDING BLOCKS

LOS ANGELES—Dedeaux Properties has broken ground on The Echelon Business Park, a 246,543-square-foot Echelon Business Park in the City of Industry, with construction expected to be complete in the first quarter of 2018. The $38 million development, located at 801 – 821 Echelon Court, has easy access to I-10, I-605 and the 60 and 57 Freeways. The Echelon Business Park's seven free-standing buildings, range between 27,438 square feet and 43,166 square feet, and include two-story office space, ample dock-height loading and configurations for loading shipping containers, all inside a modern, secured campus with pride of ownership design and image.

BY THE NUMBERS

(SOURCE: COLLIERS INTERNATIONAL)

NEW & NOTABLE

DEALTRACKER

BUILDING BLOCKS

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Middle Market Digest: This Week in Southwest

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