Intercontinental Realty Corp. Pays $74M for Amazon Warehouse
- Mar 30, 2021
Intercontinental Realty Corp. has closed on its first industrial acquisition in Los Angeles County—a last-mile distribution center fully leased to Amazon. The property traded for $74 million, according to the Commercial Observer.
CommercialEdge data indicates that the asset was previously owned by Xebec Realty Partners, which acquired the facility in December 2018 for $37 million.
CBRE’s West Coast Institutional Properties team, led by Managing Director Darla Longo and Vice Chairman Barbara Perrier, marketed the property on behalf of the seller.
Ball Corp. operated a beverage packaging plant at the site between 1975 and 2018. The late 2018 sale was subject to a $22.6 million loan, held by Zions Bank, according to CommercialEdge data.
The 13-acre site is located within a designated Foreign Trade Zone, at 20730 Prairie St., within 32 miles from downtown Los Angeles. The property comprises two Class B buildings, totaling 223,131 square feet. Previous ownership applied multiple renovations at the site before leasing the property to Amazon.
The buildings feature 30-foot clear heights, two grade-level and seven dock-high loading doors, fire sprinklers, rail doors and a parking ratio of 0.86/1,000. The last-mile delivery facility serves over 12 million people living within a 50-mile radius. State routes 118, 27, 101 and Interstate 405 are within 10 miles of the distribution center.
Tight industrial market
Geographically confined industrial markets such as the Los Angeles County one have seen a large increase in rents. Year-over-year through February, Los Angeles industrial rents rose by 7.8 percent, outperforming the 5.1 percent national average growth, a recent CommercialEdge report shows. With less space for new development than other markets, Los Angeles had a 4.4 percent industrial vacancy as of February, one of the lowest nationwide. The supply pipeline also tells a similar story, with 5.7 million square feet under construction, a mere 0.9 percent of total stock, according to the same report.
Intercontinental Senior Director of Acquisitions Jessica Levin said in a prepared statement that only a small percentage of the industrial inventory in the San Fernando Valley are buildings larger than 100,000 square feet and that the majority of those assets are older product. According to Levin, the size of the property, combined with the quality of tenancy, the seller’s recent improvements and the building’s centralized location make this an irreplaceable last-mile delivery facility in Los Angeles.
Intercontinental Real Estate Corp. currently owns upwards of 5 million square feet of industrial assets nationally, with a focus on coastal markets. In addition, its portfolio also includes some 8.2 million square feet of office properties. In June of last year, Intercontinental and Wright Runstad & Co. broke ground on 400 University at Rainier Square, within the 1.2 million-square-foot Rainer Square mixed-use development in downtown Seattle.