OC Shopping Center Lands $101M in Financing
- Mar 21, 2019
DJM Capital Partners Inc. has received $101.3 million in non-recourse bridge debt for La Habra Market Place, a 37-acre, open-air shopping center in La Habra, Calif. George Smith Partners facilitated the financing, which replaced existing senior and mezzanine loans.
“This is a large property in the midst of a successful repositioning,” Steve Bram, George Smith Partners co-founder & principal, said in a prepared statement. “The center is situated in a prime location within the La Habra market.”
The money will be used to improve the 374,000-square-foot property, including a full improvement package for a Regal Cinema lease extension which will bring a wraparound screen to the 16-screen cinema. It also covers future capital expenditures and leasing commission costs associated with the final stages of the property’s stabilization.
About $4.7 million of the financing will be utilized to fund the development of a future pad at the corner of Imperial Highway and Beach Boulevard. This pad has already been pre-leased to both Jimmy John’s and Starbucks.
Located at 1641 W. Imperial Highway, the property is anchored by Sprouts and Smart & Final, and is 96 percent leased. The tenant roster also includes Petco, Ulta, Hobby Lobby, Ross Dress For Less and LA Fitness.
Retail strong in Orange County
Marcus & Millichap’s most recent Orange County retail market report revealed that consistent growth in high-wage sectors supported a robust retail environment. Vacancy decreased in the latter part of 2018 to one of the lowest rates since before the recession, adding to a rise in rents. According to Bram, the area has shown strong retail and residential growth over the course of the past year.
“La Habra’s retail sector is demonstrating a robust growth trajectory, indicating that strong grocery-anchored centers like this one are a smart investment,” he said. “The market saw the introduction of a 17,000 square-foot Aldi prototype store in January 2018 that marked the beginning of that retailer’s expansion in the region, showing that retail fundamentals are strong there.”
In January, George Smith Partners became bicoastal as the Los Angeles-based firm just established a presence on the East Coast with the opening of an office in Midtown Manhattan.
Image courtesy of Brower Group