David Sonnenblick of Sonnenblick-Eichner in Los Angeles tells GlobeSt.com that five of the six properties were 100% leased at the time of the sale, with a portion of the sixth building vacant, bringing the overall occupancy above 95% in the 158,459-sf portfolio. Sonnenblick represented both the buyer and the seller plus arranged acquisition financing of about $17.6 million. He says five buildings were financed with long-term loans at approximately 6%, with the sixth one secured by a short-term, floating rate loan at a competitive rate. Patrick Brown of Sonnenblick-Eichner's Los Angeles office assisted with the financing.
The one- and two-story buildings were constructed in the 1970s and 1980s. All are office/warehouse buildings in the Warner Center office, industrial and retail complex, which includes six million sf of office, R&D and warehouse space. The buildings in the Kearny deal feature extensive landscaping and highly visible street frontage on Oxnard and Califa streets.
Sonnenblick calls Warner Center Business Park an excellent investment play in light of its position as a master-planned business community within the San Fernando Valley. Recent brokerage reports show the Valley's office market making a slight improvement, with direct vacancy dipping to 13.6% in the first quarter from 13.9% at yearend 2002. Overall vacancy, including sublease space, slipped to 16.3% from 16.5% during the same time period. While the changes are small, brokers say that any improvement at all is noteworthy in these times of sluggish leasing.
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