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OTAY MESA, CA-In the first divestment ever for three-year-old Argus Realty Investors LP of San Juan Capistrano, the firm sold the San Diego Distribution Center here to Modesto-based Beard Land Co. for $14.3 million. Argus had acquired the asset back in 2001 for nearly $13.1 million.”It’s our first property to go full cycle,” Argus Realty’s president Tim Snodgrass tells GlobeSt.com. The logistics building, which was the first asset that Argus Realty purchased, was originally intended for a six-year hold. However, the firm’s price target for the property was reached in just 35 months, with an 18.11% annual return for the investors, according to Argus Realty’s chairman and chief executive Dick Gee. The facility, which was not listed on the market, had attracted significant interest for quite some time, Snodgrass says. “Once we got the leases the way we wanted them and the cash flow the way we wanted it, we had numerous people who wanted to buy it all the time,” he tells GlobeSt.com. Argus Realty chose Beard Land Co. “because the firm owns about six million sf of industrial property in a different location and we wanted to buy some off of them,” Snodgrass explains. The property had been owned by Argus Realty and four tenant-in-common investors, according to Snodgrass, who calls the recent deal an example of a “successful tenant-in-common investment.” Both parties were represented in-house.Encompassing 195,540 sf, the San Diego Distribution Center is 100% leased. Tenants here include ThyseenKrupp Elevator, Axsys Technologies and Dorian’s, Snodgrass says. The facility, which stands on an 11.9-acre parcel within Otay Mesa’s Brownfield Business Park, benefits from a prime location, according to Gee. He says the asset’s success will be “greatly enhanced” by the proposed extension of the 905 Freeway, as it will give the property immediate access to a major arterial. The Otay Mesa market has been “very, very hot of late,” according to Snodgrass, who says he would buy another building located here “without hesitation.” As Snodgrass points out, “some of the issues that are always going to make it a hot market are the preclusionary barriers to entry, which are things like sewage.”

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