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3/27/19
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A private investor paid $4.9 mil for a 15.4k sf ($318/sf) retail property in Tustin. The building is located at 1620 North Tustin St, just west of the 55 Fwy at 17th St.
The property includes 98 parking spaces. Jo-Ann Fabrics and crafts had occupied the building since 1993, but decided upon the current lease expiration to move to a newer building nearby.
Tustin Street is at the center of a major retail corridor in North Orange County and sits within five miles of more than 489,000 residents. Other notable retailers in the surrounding area include Target, Trader Joe’s, The Home Depot and 24 Hour Fitness. The area is home to John Wayne Airport, as well as two major sports facilities; Angel Stadium and the Honda Center.
Nathan Holthouser and James Lehigh of CBRE represented the buyer and the seller, Said Shokrian, in the deal. According to Holthauser, the seller’s original plan was to re-tenant the property, but struggled to increase the rent that Jo-Ann Fabrics was paying before vacating.
“Right now mid-box retailers in the 15k sf – 25k sf range are not as active as they once were,” commented Holthauser. “The buyer ultimately purchased the property because of the large 1.62-acre lot.”
The OC retail market finished out 2018 with year-over-year improvements in vacancy, net absorption, and average asking lease rates, according to a CBRE research report. Net absorption for the year was positive 158.8k sf. As a result, vacancy did not change from quarter to quarter, but decreased slightly compared with the same period last year. Scarce supply of large-sized space drove up asking rates, which have been steadily on the rise since 2017.
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