One segment of the real estate investment sales market continues to perform better than others during the recession.
Multitenant retail properties and strip malls are being targeted by investors because they often offer the promise of steadier rents ?and with one Long Beach property ?big-name tenants.
That South Bay property, the Bixby Center, sold for $6.05 million April 30. Redwood City real estate investor Mike Dollinger purchased the 12-tenant strip mall at 4215 Atlantic Ave. from the Sarno Family Trust of Los Angeles.
Kirk Garabedian, a Marcus & Millichap Real Estate Investment Services Inc. broker who represented the seller, called the transaction an example of ? flight to value.?p>Tenants include Domino? Pizza, Cold Stone Creamery, Subway, It? a Grind Coffee House and Supercuts. While some of those businesses are franchises, the strong national brands were attractive to the buyer, said Joe Compagno of Marcus & Millichap.
?he buyer was attracted to the tenant base,?said Compagno, who represented Dollinger in the deal. ?t? a solid tenant basis; it? a stable shopping center. And there? the fact that it was a great infill location.?p>Dollinger did not return calls seeking comment.
The 20,740-square-foot building sold for $292 per square foot, a premium price in the recession. Bret King of Marcus & Millichap, who along with Garabedian represented the seller, said that the national tenants helped garner the high price.
The Sarno Family Trust purchased the property in 2001 for about $2 million, King said. The property, which has one vacancy, was listed in December for $6.45 million.
Airline Lease
Qantas Airways Ltd. signed a $2.1 million lease renewal in early May to stay at the Howard Hughes Towers in Westchester, near Los Angeles International Airport.
The deal for 11,755 square feet represents a downsizing of about 2,000 square feet. Qantas will give back that portion of space when the new five-year lease starts in October.
The company needs less space at the 6080 Center Drive West property because two of Qantas?related businesses there are moving, said Tony Morales of Jones Lang LaSalle Inc. who represented the airline in the deal with landlord Equity Office Properties.
?e feel that Qantas was rewarded for their long-term occupancy and their credit worthiness, and Qantas was very happy with overall economics of the deal,?Morales said.
Chris Houge of Madison Partners, who represented Equity Office, a unit of private equity company Blackstone Group LP, said the average rental rate for the lease is $2.98 per square foot per month ?a figure substantially less than the $4.50-per-square-foot-per-month asking rent of just a year ago.
?s a general statement (there) has been a significant hit to the market,?said Houge. ?e?e seen a rise in vacancy, a lowering of asking prices and an increase in concessions. These types of deals are representing the formation of a bottom.?p>Howard Hughes Towers is part of Howard Hughes Center, a 70-acre mixed-use development.
Brian Fennelly, formerly of Jones Lang LaSalle and now of Studley Inc., also represented Qantas. Hunt Barnett, Rick Buckley and Beau Rawi of Madison Partners also represented the landlord.
New Brokerage
Robert Wasserman, a former director at Studley, has started his own Santa Monica brokerage.
Wasserman resigned on his birthday ?Jan. 23 ?and by Feb. 18, Wasserman Commercial Real Estate Corp. had opened its doors. The broker said he left Studley on good terms after determining the best way to improve his business was to start his own company.
?? having a blast, but I? not sleeping much,?said Wasserman. ?ut I?e never felt better in my entire life, ever. It? my platform; I? the one that gets to run the company as I see fit.?p>The firm will focus on tenant representation, but also will handle some investment sales and purchases. Wasserman, who is chief executive, is outsourcing work to brokers on a case-by-case basis and plans to hire full-time employees by the end of the year.
Wasserman said it? a great time to start a new business, because the recession has created great deals on everything from computer equipment to the company? own office lease at 100 Wilshire Blvd.
Staff reporter Daniel Miller can be reached at [email protected] or (323) 549-5225, ext. 263.
