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3/06/23
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A 37.2k sf industrial/R&D building in Carlsbad has traded hands for second time in just over a year. In this latest deal, Hazard Jr Enterprises LP, a family-owned entity advised by San Diego-based Commercial Facilities Inc, paid $18.63 mil ($501/sf) for the property, located at 2290 Cosmos Court.
The asset was sold by Luminous Capital Management, in partnership with Austin-based Virtus Real Estate Capital, who acquired the building in January 2022 for $9.6 mil. At the time, the partnership had intended to convert the building to life science use. However, they ended up signing Reef to a 10-year lease for the entire facility.
The buyer was attracted to the property due to the long-term lease cash flow backed by REEF, a leading global manufacturer of beach-inspired footwear and apparel which has been based in Carlsbad since 2007. Luminous invested significant capital in transforming the project to house REEF’s operations. REEF took occupancy of the facility in late-January.
Following the sale, Luminous will finish additional exterior improvements, including renovated landscape/hardscape, construction of several outdoor workspaces, and the installation of a solar energy system atop new carports. The outdoor renovations are expected to be completed in June, at which time REEF will announce its grand opening.
Tom Lam, Principal, who led the purchase and sale for Luminous commented, “We initially acquired Cosmos Court with the intention of converting it for bioscience use. However, solid real estate in tight markets often presents attractive alternatives. That proved to be the case here, as the lease with REEF was compelling enough to pivot from a life science conversion.”
Virtus provided joint venture equity for the building’s acquisition and repositioning. Rusty Williams, Chris Roth, and Jake Rubendall of Lee & Associates represented ownership in the sale and the REEF lease.
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