CT Realty Corp. has acquired the 227,000-square-foot Chatsworth Business Park in Chatsworth for $10.25 million from the government of Singapore.
The Newport Beach-based development and investment firm plans to redevelop the 7.9-acre business campus, which now consists of two two-story office/R & D; buildings. Sanyo Fisher is the only tenant at the 71% vacant complex, occupying 65,000 square feet.
Dave Ball, vice president of development with CT Realty, said that was one of the attractions for his firm, which views this as a value-added play.
“There are a number of different approaches one can take to this property, but the most significant one is that it’s 30% occupied and 70% vacant, which gives us a great opportunity.”
CT Realty plans to spend $5.5 million, including tenant improvements, in an effort to improve the property through such steps as adding roughly 70 parking spaces to the existing 638 and upgrading the facility to include a state-of-the-art mechanical distribution system, new lighting and security systems, landscaping, lobbies and restroom facilities.
Significantly, Ball said the upgrades and parking expansion will allow CT Realty to position the property as more of an office property and less as an R & D; campus, giving it the potential for higher rents.
Finding undervalued properties and turning them around is not new to the principals at CT Realty. The company traditionally acquires properties it feels are undervalued, upgrades them and then resells them.
Its most recent success story: The Sherman Industrial Park in Corona, which the company acquired in July 1997 for $1.27 million. At the time, the complex was only 50% leased, but after spending $250,000 to upgrade the look and feel of the buildings,doing such things as improving the parking situation and painting and revamping the interiors,and leasing the rest of the space, CT Realty was able to sell the property for $2.43 million.
The buyer of the 54,000-square-foot park is Sherman Avenue Business Park LLC. The complex is 100% leased and tenants include Western Waste and Westpac Air Conditioning.
CT Realty was represented by Michael Lawrence of Marcus and Millichap, while the buyer was represented by Scott Oslund of Lee & Associates. n
