Edens Buys LA Shopping Center Portfolio for $137M

Beverly Hills-based Combined Properties has sold a portfolio of grocery-anchored shopping centers in Los Angeles to Edens, a DC-based investment firm, in a $137M transaction brokered by Newmark on behalf of the seller.

The transaction includes 216K SF shopping center at 802 West Beverly Boulevard in Montebello; a 121K SF shopping center at 1600 Foothill Boulevard in La Verne; and a 65K SF retail complex at 1375 Foothill Boulevard in La Verne, the latter anchored by a Sprouts Farmers Market.

Combined Properties, which acquired the properties in 2004, reaped a significant return from the trade, which translated into about $340 SF. The company bought the asset at 1600 Foothill Blvd. for $7.2M and sold it for $41.5M.

Grocery-anchored shopping centers, which proved to be pandemic resistant, also are being embraced as recession resistant by CRE investors.

The retail market in Los Angeles County staged a strong recovery in Q3 from a disappointing Q2, with net absorption of 2.9M SF in the third quarter, up from negative 170K SF in Q2, according to a report from Colliers. The vacancy rate dropped 40 bps to 5.7% while average asking lease rates increased to $3.02 per SF.

The price per square foot for this week’s acquisition by Edens is the most lucrative retail deal since the 1.5M SF Westfield Santa Anita mall sold for about $363 per SF at the end of August.

Unibail-Rodamco-Westfield (URW), as part of its ongoing divestiture of US mall assets, sold the Westfield Santa Anita mall in Arcadia for $538M, said to be the largest retail deal since 2018, to Monrovia-based investor Wen Shan Change in a transaction brokered by Eastdil Secured.

At the time of the sale, the Westfield Santa Anita was 96% leased and posted sales of $611 per square foot, with sales reaching 93% of pre-pandemic levels, the company said in a release.

URW, Europe’s largest mall operator, acquired the Santa Anita mall in 2018 as part of its $15.7B acquisition of Australia-based Westfield, which had owned and operated the mall since 2007.

Earlier this year, URW revealed it would exit the US market and sell its portfolio of US properties by the end of 2023, GlobeSt.com reported. At the beginning of 2022, the portfolio encompassed 24 malls—including some of the largest and highest-profile mall properties in the US—and five other CRE assets.