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12/05/18
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Rexford Industrial Realty recently acquired two SoCal industrial properties – in Chatsworth and La Palma -- for $43.5 mil. The acquisitions were funded using available cash on hand.
In one of the purchases, Rexford acquired 9200 - 9250 Mason Ave and 9171 Oso Ave, located in the westsern San Fernando Valley community of Chatsworth -- in an off-market transaction for $29.5 mil, or $115 per square foot. The industrial complex consists of four industrial buildings containing 256.2k sf on 11.14 acres of land and is 100% leased to three tenants in the cosmetics industry, all with significant investment in their facilities.
At lease roll the company intends to renew below-market leases to market rates, and, in the event a tenant vacates, opportunity exists to perform value-add functional and building upgrades. According to CBRE, the vacancy rate in the 174 msf LA – San Fernando Valley submarket was 1.4% at the end of the third quarter 2018.
In the other off-market transaction, Rexford picked up 5593-5595 Fresca Dr in La Palma, within the Orange County – North submarket, for $14 mil, or $122 per square foot. The two-tenant industrial building contains 115.2k sf on 5.7 acres of land. The property provides significant upside with the potential for future value-add functional and modernization improvements at lease roll, as in-place rents are estimated to be approximately 28% below market. According to CBRE, the vacancy rate in the 114 msf Orange County – North Submarket was 0.6% at the end of the third quarter 2018.
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