The El Dorado Shopping Center, a 74,500-square-foot shopping center anchored by Grocery Outlet and Dollar Tree in Long Beach, has sold for $21.3 million.
Hanley Investment Group’s Executive Vice President Kevin Fryman and President Ed Hanley represented the seller, DPI Retail of El Segundo, in the transaction. The undisclosed buyer was a partnership managed and represented by Milan Capital Management of Orange.
“We generated multiple qualified offers for this daily-needs shopping center and procured a 1031 exchange buyer,” Fryman said in a statement. “We maximized price by educating the buyer about value creation through the lease-up of the vacant pad building and a potential break-up strategy. The property offered a rare value-add opportunity to lease up a 5,040-square-foot former restaurant located on the hard corner at Norwalk Boulevard and Wardlow Road, which has 40,000 cars per day. The buyer could re-tenant the existing building or execute a ground lease.”
The El Dorado Shopping Center is located at 8105-8195 E. Wardlow Road on 7 acres at the intersection of Norwalk Boulevard and Wardlow Road. The shopping center, which was 93% occupied at the time of the sale, was built in 1965 and renovated in 2003. More than 513,000 residents with an average household income of $120,000 reside within a 5-mile radius of the property, according to Hanley.
“Grocery Outlet executed a 10-year lease in 2019 with 10% increases every five years, demonstrating its commitment to the site,” Fryman said. “Investors see a flight to safety and security in the grocery sector, especially with value grocery retailers like Grocery Outlet.”
El Dorado Shopping Center stands in a densely populated area. The city of Long Beach is the seventh most populous city in California and the Port of Long Beach is the second busiest seaport in the U.S. California State University, Long Beach boasts 34,000 undergrads, graduates and professionals plus 2,322 full- and part-time staff.
Since the start of the new year, Hanley Investment Group has sold 26 retail properties totaling $189 million, including the sale of shopping centers. In addition to the sale of El Dorado Shopping Center in Long Beach, Hanley Investment Group arranged the sale of a 42,800-square-foot Walgreens-anchored shopping center, shadow-anchored by a Kroger grocery store in the Houston metro area; a 180,000-square-foot shopping center with anchors Burlington, Dollar Tree, Marshalls, Planet Fitness and Hibbett Sports and shadow-anchored by Target in Houston; and an 82,366-square-foot Smart & Final-anchored shopping center in Simi Valley, which sold for $19.6 million. These deals all closed within the last 45 days with the Simi Valley Promenade transaction closing Jan. 10. Bill Asher, Jeff Lefko and Hanley of Hanley Investment Group represented the seller, Toibb Enterprises, on the Simi Valley Promenade, which tenants also include Goodwill, Del Taco, Denny’s, Chi Chi’s Pizza and H&R Block.
“The recent sales of these four anchored shopping centers continue to demonstrate that shopping centers with strong fundamentals are still trading at favorable cap rates,” Fryman said. “Based upon the number of closings we have already had in 2023 and the strong interest we are experiencing with our listings, we feel that 2023 will be another strong year for Hanley Investment Group.”
