Property Trades Above List Price at Historic Low Cap Rate
CORONA DEL MAR, CALIF. — (RealEstateRama) — Hanley Investment Group Real Estate Advisors, a nationally-recognized real estate brokerage and advisory firm specializing in retail property sales, in conjunction with Voit Real Estate Services, announced today that the two firms completed the sale of a single-tenant net-leased coastal property occupied by Petco at 537 North Pacific Coast Highway in Redondo Beach, Calif. The sales price of $7,630,000 represented a cap rate of 4.5%, a record low cap rate for a single-tenant Petco in Los Angeles County.
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Hanley Investment Group President Ed Hanley and Executive Vice President Bill Asher, along with the seller’s exclusive advisor Joe Miller, a vice president at Voit Real Estate Services, represented both the seller and buyer in the 1031 exchange transaction. The seller was The Beacon Group, Inc., a California Corporation, based in Orange County. The buyer was a private corporation based in Los Angeles.
Built in 1981, the 17,160-square-foot Petco building sits on a 1.07-acre parcel in the King Harbor Plaza, shadowed anchored by Smart & Final. Petco has occupied the building for 22 years and recently signed a 10-year lease extension.
“We generated over 10 offers in the first two weeks of marketing, providing clear evidence that a flight to quality is what investors are seeking in today’s retail investment market,” said Asher.
“Due to the high level of demand based on the prime coastal South Bay location and Petco’s long-term historical occupancy and recent lease extension at the location, we structured a best and final offer process that resulted in a final sales price 25 basis points better than the original list price,” commented Hanley.
“This property fulfilled many investors’ acquisition criteria requirements,” said Hanley. “It is a well-established, successful location with high traffic count, great co-tenancy and retail synergy in the area; stability of Income; excellent visibility and identity; and irreplaceable coastal location with strong demographics and nearby residential.”
“We negotiated a 14-day due diligence period with no loan contingency with a qualified 1031 exchange buyer based in Los Angeles that was familiar with the overall strength of the tenant and location,” said Asher.
“A flight to security for stabilized single-tenant net-lease properties in major metro markets across the country continues to be in high demand and those leased to credit retailers are continuing to trade at record pricing,” Asher said.
About Voit Real Estate Services
Voit Real Estate Services is a privately held, broker owned Southern California commercial real estate firm that provides strategic property solutions tailored to clients’ needs. Throughout its 40+ year history, the firm has developed, managed and acquired more than 64 million square feet and completed more than $44.8 billion in brokerage transactions encompassing more than 43,000 brokerage deals. Voit’s unmatched expertise in Southern California brokerage, investment advisory, financial analysis, and market research enable the firm to provide clients with forward looking strategies that create value for a wide range of assets and portfolios. See www.voitco.com.
About Hanley Investment Group
Hanley Investment Group Real Estate Advisors is a retail investment advisory firm with a $5 billion transaction track record nationwide, who works closely with individual investors, lending institutions, developers, and institutional property owners in every facet of the transaction to ensure that the highest value is achieved. For more information, visit www.hanleyinvestment.com.
