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Nexus Has More Plans at Anaheim’s Platinum Triangle



RESIDENTIAL

San Diego-based Nexus Properties Inc. is at it again in Anaheim.

Windstar Communities LLC, the residential arm of Nexus, was the first developer to take advantage of new housing-friendly zoning for land near Angel Stadium of Anaheim. Now it’s tackling another housing project there.

Windstar and partners recently paid $12.2 million for 3.9 acres on Orangewood Avenue across the street from the stadium. Windstar is partnering on the deal with Los Angeles-based West Millennium Homes and Highgate Holdings, an Irving, Texas-based real estate investor.

The acquisition price, which works out to $3 million an acre or so, is a sign of the times,both of the hot housing market and what happens when a city supports housing in a popular area.

Of course, the stadium area today consists mostly of older industrial and office buildings, motels and gas stations. Developers are working on the theory that it will attract homebuyers and renters.

The city has created special zoning for land near the stadium between the Santa Ana (I-5) Freeway, the Santa Ana River and railroad tracks. The area is known as the Platinum Triangle.

Anaheim has left existing zoning in place there, creating an overlapping zoning plan that looks at projects on a case-by-case basis. It allows housing mixed with shops and other uses.

Eric Heffner, a principal with Windstar, said the partners plan about 250 condominiums. He said they should be working with the city this year on approvals and hope to break ground next year.

The deal also is notable for the seller: Crystal Cathedral. Heffner said the Garden Grove-based church has a warehouse on the Anaheim site.

Rick Warner of CB Richard Ellis Group Inc. represented the buyers. The church represented itself.



Where the Work Is

Irvine-based developer SunCal Cos. opened an Inland Empire outpost in early May.

The company long has been active, buying land there and prepping it for homebuilding, but until now it did all that from OC.

These days the company is developing 20 masterplanned communities inland.

SunCal moved about 30 workers from Irvine to its 10,300-square-foot office in Corona Pointe Business Park in Corona. The city has become a popular hub for homebuilders and other real estate-related companies.

The company has about 65,000 lots in development inland, including College Park in Chino, Fairway Canyon alongside the PGA Oak Valley golf course in Beaumont, the lakeside community of Terra Lago in Indio and SummerWind Ranch in the hills of Calimesa.


COMMERCIAL

Commercial developers may be happy to hear that not every deal in Anaheim these days involves turning commercial land to residential use.

Case-in-point: Newport Beach-based Turner Development Corp. recently paid $18 million for Anaheim Hills Corporate Park, a seven-building, 134,518-square-foot, class A office park in Anaheim.

Turner is set to convert the property into 44 condominiums,of the office and industrial type. They’re set to range in size from 1,313 square feet to 11,504 square feet and go for $300,000 to $2 million.

Several of the units are less than 2,000 square feet.

The conversion to condos should take nine to 12 months, with Anaheim reviewing a parcel map, according to Turner. Space is available for lease sooner, with the option to buy once the property is subdivided.

Jack Faris, Al Pekarcik and Dan Vittone of Voit Commercial Brokerage LP represented Turner and the seller, Newport Beach-based WLA Investments.

Faris also is handling the condo sales. By Turner’s closing of escrow, he had presold nearly a third of the condos.



Sky High

I keep seeing deals going for high prices so I suppose it’s not surprising that San Franciso’s Urban Realty Advisors paid $330 per square foot, or $17.6 million, for a 53,484-square-foot class A office building in Santa Ana.

The building, at 3601 Sunflower Ave., is fully occupied by the Art Institute of California’s Orange County unit. The school has another 15 years remaining on its lease with 3% annual increases, according to Grubb & Ellis Co., which brokered the deal.

Brokers often tell me that investors are interested in a property’s capitalization rate, or cap rate. This rate measures the value of future income from a building relative to its sale price.

Calculating the cap rate involves some art and some science, according to what I’ve heard. In any case, cap rates have been going down as prices have gone up. The Sunflower building went for a cap rate of 6.5%, according to Grubb & Ellis.

Kevin Shannon, Scott Schumacher, Ryan Gallagher and Jeff Hanson of Grubb represented the buyer and seller in the deal.

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