Steel Peak has sold a 12,000-square-foot IOS property located on 2.5 acres at 1324–1336 Magnolia Avenue in El Cajon, California, to oil and gas industry firm C&M Manufacturing for $9.5 million.
Steel Peak, which originally purchased the asset in February 2024 for $6.3 million, has performed significant renovations on the property.
Several dilapidated structures were demolished at the degrading multi-tenant yard. Only one office and two shop buildings were preserved.
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After allowing the existing tenants to remain in place for the first 12 months, the site was repositioned with new paving, fencing and comprehensive interior and exterior building upgrades.
The redevelopment also opened up the site for full drive-through access and expanded yard space, significantly improving overall functionality for IOS tenants, of which C&M is now one.
“These properties are extremely hard to find due to their zoning, which allows for outdoor storage by right,” Pasha Johnson, Steel Peak principal and co-founder, told GlobeSt.com.
“There are virtually no available properties within the submarket that compete with 1324 Magnolia. The buyer had to have the zoning to operate their business, which involves storing materials outdoors.”
The Magnolia Avenue property spans approximately 2.5 acres and includes warehouse, office and yard space for outdoor storage. There is M-54 zoning, a level fenced yard, entitlement for outside storage and multiple access points.
Kerry Schimpf and Cameron Czubernat of Commercial Properties Group represented Steel Peak in the sale. Aidan James of Inland Pacific represented the buyer.
Steel Peak will continue to seek IOS investment opportunities throughout the Western US in markets such as Phoenix, Denver and Las Vegas, with capitalized values ranging from $3 million to $50 million, Johnson said. He added that San Diego, Seattle and Salt Lake City have been its most active markets.
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