Los Angeles Industrial with Value-Add Upside
Huge Value-Add Opportunity: The largest tenant at the property vacated at the end of October leaving the project 77% leased. A new owner will be able to quickly backfill the space and stabilize the property.
Below Market Rents: Average in-place rents are more than 30% below market, including the largest tenant at the property that is approximately 50% below market.
Extremely Tight Submarket: The South Bay is the 1 industrial submarket in Los Angeles and currently boasts a vacancy rate of just 2.1%.
Motivated Seller / Attractive Basis: The seller is motivated to transact by year-end, and the property is expected to trade at an extremely attractive basis compared to similar properties in the area.
Newmark and RI Marketplace are pleased to present the opportunity to acquire the fee-simple interest in 245-261 E 157th Street in Gardena, California (the “Property”). The offering consists of a 77% leased, 70,546-Square-Foot, multi-tenant, industrial project located in the highly sought-after South Bay area of Los Angeles. The Gardena submarket continues to be extremely tight and boasted a 2.1% vacancy rate as of Q3 2021.
The Property consists of two concrete-tilt industrial buildings that total 70,546 square feet and are situated on a 2.86-Acre parcel. The buildings are extremely functional and feature 19' to 22' clear heights with 15 ground level doors and two dock-high doors. The project features above average parking at a ratio of 2.3/1,000 SF, and the largest tenant at the property is 50% below market, presenting a huge amount of upside at lease expiration.
The offering presents an extremely rare, value-add opportunity for an investor to acquire a well-located, infill, industrial deal with huge upside that can be achieved by leasing up the in-place vacancy and rolling tenants to market upon lease expiration, with in-place rents more than 30% below market. The property is expected to trade at an extremely attractive basis compared to similar product that has been selling in the mid $200 per-square-foot range, with user sales climbing closer to $300/Sf.