After acquiring the 227,000-square-foot Chatsworth Business Park for $10.25 million from the government of Singapore, Newport Beach-based development and investment firm CT Realty Corp. plans to redevelop the 7.9-acre business campus.
Sanyo Fisher is the only tenant at the 71 percent vacant Chatsworth complex, which now consists of a pair of two-story office/R & D; buildings. Sanyo Fisher occupies 65,000 square feet.
Dave Ball, vice president of development with CT Realty, said the high vacancy was one of the attractions for his firm, which views this as a value-added play.
“There are a number of different approaches one can take to this property, but the most significant one is that it’s 30 percent occupied and 70 percent vacant, which gives us a great opportunity.”
CT Realty plans to spend $5.5 million, including tenant improvements, to upgrade the property through such steps as adding roughly 70 parking spaces to the existing 638 and upgrading the facility to include a state-of-the-art mechanical distribution system, new lighting and security systems, landscaping, lobbies and restroom facilities.
Ball said the upgrades and parking expansion will allow CT Realty to position the property as more of an office property and less of an R & D; campus, giving it the potential for higher rents.
Finding undervalued properties and turning them around is not new to the principals at CT Realty. The company traditionally acquires properties it feels are undervalued, upgrades them and then resells them.
Its most recent success story was the Sherman Industrial Park in Corona, which the company acquired in July 1997 for $1.27 million. At the time, the complex was only 50 percent leased. But after spending $250,000 to upgrade the look and feel of the buildings doing such things as improving the parking situation and painting and revamping the interiors and leasing the rest of the space, CT Realty was able to sell the property for $2.43 million.
The buyer of the 54,000-square-foot park is Sherman Avenue Business Park LLC. The complex is 100 percent leased to such tenants as Western Waste and Westpac Air Conditioning.
CT Realty was represented in the Corona deal by Michael Lawrence of Marcus & Millichap Real Estate Investment Brokerage Co., while the buyer was represented by Scott Oslund of Lee & Associates.
