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Commercial Real Estate Transactions

Walton Sells 372 Lots to D.R. Horton for Residential Development in Southern California’s Inland Empire

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COMMERCIAL REAL ESTATE TRANSACTION ALERT

Walton, a real estate investment and land asset management company with US$3.39 billion under management, has sold 276 lots in Victorville and 96 lots in Moreno Valley, both located in the Riverside-San Bernardino-Ontario metropolitan area, to D.R. Horton, the largest homebuilder by volume in the United States.

The Victorville sale of 52 acres for a planned community named Santolina closed in March 2021 and is located in the West Creek master plan at Mojave Drive and Cobalt Road. The San Bernardino County pre-development land is planned for 276 single-family homes ranging from 1,602 to 2,617 square feet offering a variety of homes for individuals, families and multi-generational households. Development of the property is anticipated to begin this spring with home sales expected to start in summer 2021.

Victorville is a leading city for both industry and retail in the High Desert region. It is a growing, vibrant community, home to mountain vistas and family-friendly recreational activities including Spring Valley Lake, and within a few hours of SoCal beaches, national parks and mountain retreats. Located within a 10-minute drive of shopping centers and restaurants, three schools are adjacent to the property including a charter school, elementary and middle school. I-15 provides convenient access to employment centers located throughout the Riverside-San Bernardino area.

In a second transaction, Walton sold 30 acres located at Alessandro Boulevard and Brodiaea Avenue in the planned community called Del Sol in Moreno Valley. The final platted property is intended for 96 single-family homes ranging from 1,978 to 2,722 square feet. Walton entered into a residential land option agreement with D.R. Horton who acquired the land to develop the community perfect for first-time homebuyers. Development of the property is anticipated to begin this spring with home sales anticipated in late fall 2021.

Moreno Valley is the second-largest city in Riverside County, offering a family-friendly community and good access to one of the most active employment corridors in the Inland Empire. The community features acres of parks, bike paths and scenic vistas and is home to schools, great dining, the Cottonwood Golf Center and March Field Air Museum.

The Victorville and Moreno Valley properties are located in the expanding residential areas of the Inland Empire of southern California, 45 minutes from Ontario Airport and provide commuter access to downtown Los Angeles and San Diego.

“We are excited to support the delivery of new homes in highly desirable communities like Victorville and Moreno Valley, which are prime for residential development,” said Ed Hadley, Executive Vice President of Builder Land Acquisition for Walton. “These new-home communities contribute to the greater infrastructure of the Inland Empire region and provide affordable single-family living as well as an attractive investment opportunity, which is one of Walton’s exit-focused strategies working with national builders to acquire land.”

Walton currently has several thousand acres under management in the Inland Empire area and is actively working on a number of additional land opportunities in the area.

Walton’s portfolio of more than 105,000-acres located across the United States and Canada, provides
a scalable land acquisition platform to support homebuilders with just-in-time inventory. Walton’s approach is an innovative response to secular shifts in the land development industry.

For more than 40 years, Walton has researched, planned, and structured pre-development land investments located in the major growth corridors throughout the United States and Canada. The evolution of Walton has opened the door to creating additional opportunities for investors and home builders alike.

The Inland Empire Business Journal (IEBJ) is the official business news publication of Southern California’s Inland Empire region - covering San Bernardino & Riverside Counties.

Commercial Real Estate Transactions

Avison Young brokers sale of a newly developed 205,589-sf industrial building in Perris, CA

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Avison Young announced today the sale of a 205,589 square-foot industrial building located at 100 Walnut Avenue in Perris, CA.

Avison Young Principals Cody Lerner and Stan Nowak represented the seller/developer, Los Angeles-based developer and investor Dedeaux Properties LLC. The buyer, a private investor from Southern California, was represented by Carol Taubman of Westgate Industrial Properties.

“When Dedeaux Properties acquired the land a few years ago, the Inland Empire East submarket wasn’t as strong as it is today. It has since become an increasingly desirable area as land becomes less available,” said Lerner.

Lerner added, “We are pleased that Dedeaux entrusted us to execute its exit strategy, which has successfully enabled the company to reach its financial and operational goals for this facility.”

Nowak added, “The Inland Empire continues to be one of the hottest industrial markets in the nation, where user demand is outpacing construction deliveries despite a robust development pipeline. We believe this trend will continue for the foreseeable future and will bolster development and capital investment despite macro-economic headwinds.”

The recently construction facility is situated on 9.56 acres, and includes a 36-foot clear height, 27 dock doors and 1,200 amps of power.

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Commercial Real Estate Transactions

Newmark Represents DCG Fulfillment in 190,000- Square-Foot Warehouse Lease in California’s Inland Empire

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Transaction Marks DCG’s 10th Building in California, Bringing Total Footprint to 3.4 Million Square Feet

Commercial Real Estate Transaction Alert

Newmark​ announces DCG Fulfillment has signed a 189,280-square-foot industrial lease at 13481 Valley Boulevard in Fontana, California. Newmark Executive Managing Directors Mark Kegans, SIOR and Ron Washle, SIOR represented DCG Fulfillment, a family-owned third-party logistics provider based in California’s Inland Empire.

“We are happy to have completed another successful transaction for DCG Fulfillment,” said Kegans. “With vacancy in the Inland Empire below 1%, options for tenants are few, and we were pleased to secure this prime distribution location for the company.”

DCG’s new space is part of a larger 600,080-square-foot industrial warehouse property located in the Inland Empire West. The property features cross-dock loading, approximately 5,000 square feet of office space, 35 dock-high doors, one grade-level door, 32-foot clear height, K-17 sprinklers, 800-amp power and parking for 116 automobiles and 150 truck trailers.

The property is situated just off Interstate 10 in Fontana, approximately 45 miles east of Los Angeles. The location provides access to major logistics and transportation locations along the West Coast, including Los Angeles International Airport and the Ports of Los Angeles and Long Beach.

According to Newmark Research, industrial vacancy in the Inland Empire remains the lowest in the U.S. at just 0.8% as of the second quarter of 2022. Occupancies of new construction deliveries propelled quarterly net absorption of 3.9 million square feet. There is currently 39.9 million square feet of industrial space under construction in the market, a record high. As the California Federal Reserve continues to increase interest rates to battle inflation, a gradual cooling of the unprecedented industrial market fundamentals across the U.S. is likely. However, as the nation’s top industrial market, vacancy will likely be better insulated in the Inland Empire if a recession occurs.

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Commercial Real Estate Transactions

SRS’ Investment Properties Group Brokers $35 Million Sale of Major Portion of One Eleven La Quinta Center, a 154,383-SF Retail Community Center in La Quinta, CA

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SRS Real Estate Partners’ Investment Properties Group (IPG) announced it has completed the $35 million sale of a 154,383-square-foot portion of One Eleven La Quinta Center, a retail community center located at 78959 CA-111 in La Quinta, CA.

SRS Senior Vice Presidents Chris Tramontano and John Redfield represented the seller, a Coachella Valley-based private family office. The buyer, Anaheim, CA-based Milan Capital Management, represented themselves. Terrison Quinn and Casey Mahony of SRS Real Estate Partners have and remain exclusive leasing agents for the asset which was 79% occupied at the close of escrow.

Tenants in the center that were part of the property sale include Ross Stores, Staples, Petco, Big 5 Sporting Goods, among others. The center is shadow anchored by tenants that include Stater Bros, Hobby Lobby, and Kohl’s.

Built in phases between 1992 and 2002, this is the first sale of the center since development over 30 years ago. One Eleven La Quinta Center totals 852,465 square feet and is situated on 19.57 acres of land. An irreplaceable highly-successful center, One Eleven La Quinta Shopping Center is located at one of the best intersections in all of the Coachella Valley, Washington & 111 visible to over 70,000 cars per day.

“The sale of One Eleven La Quinta Center was a very detailed complex transaction with several obstacles to overcome, including multiple loans on different portions of the property, a rising interest rate environment and a new Panera Bread pad development still in the contingency period that was critical to the proforma NOI that was underwritten.  I’m proud of our investment sales and leasing teams for coming together and providing excellent execution for both the seller and buyer,” said Tramontano.

“After 30 years of successful operation of One Eleven La Quinta, the seller was ready to pass the baton to a great southern California operator. This transaction had its challenges and many moving pieces, fortunately all outside of the high-quality real estate that was purchased. Chris Nichelson and the Milan Capital Management team demonstrated at great lengths their expertise in completing this transaction. This was a team effort and I’m excited to see the value Milan and the SRS leasing teams add to take the center to new heights,” said Redfield.

“We have been working with the seller and the SRS team for many years to acquire this well-located asset,” said Chris Nichelson, President of Milan Capital Management. “Their professionalism and diligence helped us overcome numerous challenges to get this deal done in an increasingly difficult environment. We are excited to have the opportunity to continue the original developer’s legacy, and to take this property to the next level.”

“One Eleven La Quinta Center is one of the preeminent retail centers for the Coachella Valley since its inception. It was important for the seller that the project’s legacy of success endures. Milan Capital Management’s level of sophistication and vision for the center made it clear they were the perfect buyer. The collaboration with the SRS capital markets team was critical to completing what was a very complicated transaction to the benefit of both parties. Under the stewardship of Chris Nichelson and Milan Capital Management’s team, we already have several new tenants in negotiation and the new Panera drive-thru is scheduled to open this fall,” shared Mahony.

Located along Highway 111, the region’s major retail corridor, the property is within a dense, affluent trade area with a population of 160,000 and more than 58,000 employees within a five-mile radius.

In 2021, SRS’ Investment Properties Group (IPG) and National Net Lease Group (NNLG) completed more than $3.1 billion in deal volume comprised of 899 transactions in 49 states, and currently have more than $2 billion in property on the market, with nearly 200 properties sold year-to-date in 2022.

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