BLT Enterprises has acquired seven industrial and creative office properties for $130 million.
The Santa Monica-based real estate investment firm purchased the assets — located in Los Angeles County, Orange County and San Diego County — last month. The acquisitions total nearly 270,000 square feet of buildings on more than 18 acres of land.
“Utilizing our seasoned team’s investment and market acumen, BLT saw the opportunity to expand our footprint in the Southern California markets where we actively own and manage creative office and industrial properties,” Lukas Huberman, BLT’s director of acquisitions, said in a statement. “Leveraging our deep experience and local relationships, we plan to implement our proven capital improvement strategies and hands-on management procedures across the assets to unlock long-term value and enhance operations.”
The outlook for creative office and industrial space remains strong throughout the Southern California markets. As the post-pandemic return to the office continues, creative office development and occupancy rates are expected to improve, while industrial space continues to be a superior performer across Southern California, according to BLT.
With no slowdown in sight, the steady demand for industrial space has driven vacancy rates to all-time lows, and Southern California vacancy rates remain below 2%, per BLT’s research.
In the wake of hybrid/remote work and tightening development and operational constraints shifting workplace environments, owners and tenants are facing fresh challenges. BLT anticipates a new era of office and industrial space, according to Rob Solomon, chief development and legal officer at the company.
“Having developed or acquired more than $2 billion in assets to date, our experienced team and thoughtful development strategy set the foundation for BLT’s exceptional track record of success in industrial and creative office real estate,” Solomon said in a statement. “These acquisitions are directly in line with our ongoing strategy of acquiring well-located properties that deliver value over a long hold period. With the recent post-pandemic shifts, BLT’s grasp on the unique demands of today’s office and industrial space positions us to continue growing and adapting with our tenants and to develop long-lasting business relationships.”
The largest acquired property, at 621 Hawaii St. in El Segundo, is a 49,307-square-foot office building situated on 1.97 acres. The property is fully leased to Nexon America Inc., South Korea’s largest video game developer. It is between the Raytheon and Northrop Grumman buildings, part of El Segundo’s aerospace and defense sector. As the city undergoes rapid renovation and adaptive reuse, the region continues to be one of the most sought-after markets in Southern California, with a highly diverse tenant base.
BLT also purchased 7748 Industry Ave. in Pico Rivera. The property is a 10,400-square-foot warehouse building on 0.85 acres. The site is anticipated to fulfill the high demand for distribution and outdoor storage facilities within greater Los Angeles.
2901 Thornton Ave. in Burbank was also acquired. A 10,246-square-foot warehouse building situated on 0.8 acres, 2901 Thornton Ave. is located off Interstate 5, just minutes from the Burbank Airport. This asset is fully leased to Reno Hardware.
In Culver City, BLT bought 6368 and 6374 Arizona Circle. 6368 Arizona Circle is a 6,900-square-foot office building on 0.32 acres, and 6374 Arizona Circle is an 8,100-square-foot creative office building on 0.32 acres.
Located off Interstate 405, 6368 and 6374 Arizona Circle are in the submarket’s “techtainment” ecosystem.
BLT is bullish on the creative office sector and targets the acquisition of properties within desirable Los Angeles submarkets such as Culver City and Playa Vista, Huberman said.
The purchase also included properties in Costa Mesa and Vista.