Two Buyers Spend $43M for Inland Retail

[IMGCAP(1)]HEMET, CA-A Los Angeles-based group has paid $23.4 million for an 87,986-sf center here and a San Diego buyer has acquired a 29,006-sf property in Rancho Cucamonga for nearly $20 million in two Inland Empire retail deals closed by Irvine-based Faris Lee Investments. The Hemet property is Hemet Village, a newly constructed power center that is anchored by Office Depot, PetSmart and Marshalls. The Rancho Cucamonga deal involves the pre-sale of Foothill Plaza, a center at the Interstate 15 Freeway and Foothill Boulevard across from the 1.3-million-sf Victoria Gardens lifestyle shopping and entertainment center.

Los Angeles-based Jianna Properties LLC acquired the Hemet Village from Westrust, a prominent Southern California retail developer based in Calabasas and San Francisco. The property is located on the southeast corner of Florida Ave. (Highway 74) and Sanderson Avenue.

Westrust was represented by Richard Walter, president, and Donald MacLellan, managing director of Faris Lee, with Brian Bielatowicz and Ted Rivenbark of Lee & Associates assisting Faris Lee in providing local market expertise. Walter and MacLellan, who also represented the buyer, note that the property generated multiple offers.

[IMGCAP(2)]The property’s strong credit tenant mix and busy retail corridor location in Hemet were key points in the marketing of the center, which was completed in 2006. The center is situated on 7.54 acres and was 97% occupied at the close of escrow. In addition to the anchor tenants, the center also includes: Starbucks, Jamba Juice, Supercuts and Rubio’s Fish Tacos. In-N-Out Burger is also at the center but was not a part of the sale.

The Rancho Cucamonga property, Foothill Plaza, was acquired by an investment group led by San Diego-based Sechong I LLC for $19.75 million. Built in July 2007, the property consists of four retail pads and a multi-tenant shops building. Among the tenants are El Torito Grill, Citi Bank and El Pollo Loco.

[IMGCAP(3)]According to Jeff Conover, director of advisory services for Faris Lee Investments, the center sold at a 5.84% cap rate and $681 per sf, a record for comparable properties in the Inland Empire. Conover represented the seller and developer of the center, Newport Beach, CA-based Peninsula Retail Partners. The pre-sale strategy for the property allowed escrow to close upon the tenants obtaining a certificate of occupancy, allowing the developer to take its profit and move forward on other developments.