Premium Price Paid for Burbank Shopping Center

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A Burbank shopping center near the 5 freeway and Alameda Avenue has sold for $48.6 million, or about $650 a square foot. The sale far exceeded the $272-a-square-foot average sale price for the submarket, according to CoStar Group Inc.

The 74,391-square-foot Gateway at Burbank was purchased by a fund advised by downtown L.A. commercial real estate giant CBRE Group Inc.’s CBRE Global Investors. The seller was a partnership of Santa Barbara real estate firm Invest West and Montecito equity provider Santa Barbara Capital. The deal closed May 6.

The 6-acre property, at 25-113 E. Alameda, comprises two buildings with multiple retail tenants, including Ralphs Grocery Co., which has its own 51,582-square-foot parcel; CVS Corp.; Baskin-Robbins; Starbucks; and Habit Burger Grill.

The property was fully leased at the time of the sale.

El Warner and Tom Lagos of Colliers International represented both sides of the transaction.

The partnership purchased the property in September 2008, right before the financial crisis, for $40.5 million. It was seeking a 1031 exchange, which allows a seller to defer capital gains taxes if sale proceeds are rolled into another property of equal or lesser value, and was happy to find a buyer that would allow it 90 days to identify another property, Warner said.

CBRE’s Kim Hourihan, portfolio manager for the fund that purchased the property, said her group looks for grocery-anchored shopping centers in the greater L.A. area and liked the Gateway Burbank’s proximity to the freeway. The fund plans to hold on to the shopping center for a long time, and the tenants, which have long-term leases, will remain the same.

Warner said the sale was the largest for a grocery-anchored shopping center in Los Angeles in the past eight years.

“Sellers are looking at the market and realizing there is such a lack of supply

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