Northbrook, Ill.-based Pine Tree acquired the 2.2-acre asset at 106-146 S. Brand Blvd. from EB Arrow, based in Dallas.
The property, which was built in 1998, is 94.8% leased. Its tenants include Ross Dress for Less, LA Fitness, HomeGoods, Five Below, Buffalo Wild Wings and Old Navy.
“We are very excited about this acquisition as we believe that Glendale Marketplace is a model for success in today’s rapidly evolving retail environment,” Conor Bossy, executive vice president and director of acquisitions at Pine Tree, said in a statement. “We were attracted to Glendale Marketplace because of its unique and urban location, significant barriers to entry, high traffic counts and its proximity to nearby destination retail like Americana at Brand and Glendale Galleria.”
The acquisition brings Pine Tree’s shopping center portfolio footprint to 1.1 million square feet in the L.A. area.
Jones Lang LaSalle Inc.’s Gleb Lvovich, Bryan Ley, Geoff Tranchina and Daniel Tyner represented the seller in the transaction.
Lvovich said JLL started working to sell the property prior to the start of the Covid-19 pandemic but had to “pause for a while.”
The company started the process of selling the asset again in July and received roughly a dozen offers before closing in December.
“The sellers are a value-add firm. They buy assets, fix them up and sell them,” Lvovich said of why they decided to sell.
Lvovich said the buyer had a “core plus strategy. They don’t need a higher return (like) on value add … they just want to buy properties with good cash flow and incrementally add to that cash flow.”
He added that there was an interior courtyard at the Glendale Marketplace, which has some vacant spaces that the new owner could revitalize.
Lvovich said the property offered a strong cash flow even for a buyer that does nothing, but for a buyer that updates the courtyard area, there was a huge upside.
The asset’s location, he added, is part of what made it so desirable. The area has added more than 2,100 multifamily units within walking distance to the property in the last five years.
“What’s happened in Glendale is there have been an incredible number of multifamily units that have been added,” Lvovich said. “That will continue to happen. Multifamily demand has been really strong.”
He added that unlike some retail areas in L.A., Glendale can rely on residents and not the office population causing the area to do well despite the pandemic.
Outside of just Glendale, Lvovich said, he’s seen a lot of demand for retail properties and was seeing more offers and interest than he did pre-Covid.