LBA Realty has snapped up a Cypress distribution facility for nearly $97 million, marking the largest local industrial acquisition of the year.
The Irvine-based firm paid $96.6 million, or about $178 per square foot, for the 543,431-square-foot Cypress Distribution Center, property records indicate.
The site currently holds two industrial buildings: a 204,314-square-foot property at 11130 Holder St. and a 339,117-square-foot building at 6550 Katella Ave. Both have direct access to the 405 and 605 freeways.
Sources indicate the seller, Stockbridge Capital Group of San Francisco, had been actively listing the site after plans fell through to convert the 22.4-acre property into a creative office project.
Stockbridge paid a reported $60 million for the site in 2014, when it was used by apparel maker Vans Inc. for its area base. Vans moved its headquarters to Costa Mesa a few years ago.
New plans for the Cypress site have not been disclosed by privately held LBA, whose best-known area property is the Park Place mixed-use campus in Irvine near John Wayne Airport.
Its acquisition of the then-distressed Park Place campus and excess land during the previous market crash at rock-bottom price turned out to be one of the savvier local investments in recent memory.
Office Space
LBA financed the deal in part by a $49.5 million loan provided by the Teachers Insurance and Annuity Association, records indicate.
The building fronting Holder, which includes 23,336 square feet of office space, was fully leased at the time of sale, counting Primary Color Inc. as its largest tenant.
The Katella building includes 104,354 square feet of office space and was nearly 72% leased. Shaw Industries occupies north of 230,000 square feet there, according to CoStar Group Inc. data.
CBRE Group represented Stockbridge in the deal.
Amazon Next Door
Industrial sales have seen more activity as of late than other commercial sectors, like office and retail, as e-commerce and other logistics companies continue to grow as a result of ongoing stay-at-home orders.
The Cypress Distribution Center, which was built in 1989, is next to the former campus of Mitsubishi Motors North America Inc., a mix of industrial and office buildings that has seen significant changes since the auto company announced plans last July to relocate its headquarters to Tennessee.
A few months after the announcement, the campus was sold to a venture headed by Irvine’s Greenlaw Partners, which along with LBA was one of Orange County’s most opportunistic commercial real estate investors during the last downturn.
Greenlaw paid Mitsubishi $57.5 million for the property; records indicate that the purchase was financed through a loan made with Duke Realty Corp. (NYSE: DRE).
More recently, e-commerce giant Amazon.com Inc. presented plans to build a ground-up last-mile logistics facility at the ex-Mistubishi site; specifics for the size of the project haven’t been disclosed, though an industrial project in the 350,000-square-foot range could likely fit in the space.
Indianapolis-based Duke Realty is heading the development project, city filings indicate.
