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LOS ANGELES-An affiliate of Westcore Industrial Properties has paid $18 million for the 409,000-sf Pacific Gulf Distribution Center in City of Industry, setting one of the final milestones in the life of what was once perhaps the Southland’s most popular REIT.

The three-building warehouse and distribution complex stands in the 16000 block of East Gale Avenue, about five miles east of Downtown, and was sold by Pacific Gulf Properties Liquidating Trust. The trust was formed several months ago to help Newport Beach-based REIT Pacific Gulf Properties officially “and voluntarily” go out of business.

While executives at several real estate investment trusts across the US have recently been blasted by analysts and shareholders alike for failing to sell their properties as the market appeared to peak, Pacific Gulf’s management decided more than a year ago to begin liquidating most of the company’s holdings in an effort to create more value for its stockholders.

Pacific Gulf’s decision to sell its portfolio stands in stark contrast to a fellow REIT in neighboring San Diego, Burnham Pacific Properties Inc. About the same time that Pac Gulf’s board voted in October 2000 to begin selling the company’s holdings to maximize shareholder value, Burnham Pacific’s board rejected a $13.50-a-share offer from Ohio-based investor Jay Schottenstein by dismissing the offer as “too low.”

Within a few months, Burnham Pacific’s stock was selling for less than half the amount that Schottenstein had offered to pay — even as Pac Gulf’s shareholders began receiving hefty distributions from the sale of their REIT’s properties. And in a move that added salt to the wounds of angry Burnham Pacific investors, their own REIT’s board agreed to pay millions of dollars in severance to some top executives before the board decided to start liquidation proceedings of its own.

The City of Industry business park sold by Pacific Gulf’s liquidating company was acquired by San Diego-based Westcore Industrial’s Westcore-Gale LLC entity. The deal was brokered by a team from LA-based Secured Capital Corp., plus Tom Taylor and Steve Bellitti of Colliers Seeley International.

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