Land in Brea that once held an RV storage facility is on the fast track to hold one of the city’s largest new industrial buildings.
Clarion Partners LLC, a New York-based real estate investment manager, and Pacific Industrial, a Long Beach-based industrial development firm, said this month that they closed on the purchase of nearly 17.7 acres at 1225 W. Imperial Highway in Brea.
The site is about two miles west of the Orange (57) Freeway and near the intersection of Imperial and Puente streets.
The new owners are planning to build a 367,194-square-foot logistics and distribution facility. A building of that size would be among the eight largest industrial facilities in Brea, according to CoStar Group Inc. records.
Plans call for the Imperial Distribution Center to feature 55 dock-high doors, 36-foot minimum clearance, and 4,976 square feet of two-story office space, according to the developers.
“This is one of the premier development projects in the entire county,” said Dan Floriani, a Pacific Industrial partner and cofounder.
Construction is expected to begin in the next month, according to Jeff Chiate, executive director of the Irvine office of Cushman & Wakefield Inc., who along with colleagues Rick Ellison and Randy Ellison is part of the leasing team for the development.
The project is scheduled to be finished by year-end, and the building is being built on a speculative basis.
The new owners are “optimistic we will attract a great business looking for a class A facility,” Floriani said.
The North Orange County industrial market’s current vacancy rate is 3.4%, the lowest it has been since early 2008, according to the new owners’ data. Clarion officials said they expect to see strong rent growth in the area’s industrial market over the next five years.
Other new industrial projects in Brea are attracting strong interest, according to industry watchers.
A trio of buildings in the city that Newport Beach-based Western Realco is constructing near the La Floresta community are close to selling out, industry sources said. The buildings run as large as 155,000 square feet.
The Imperial Highway property was sold by a venture between Irvine-based Greenlaw Partners and New York-based Westbrook Partners LLC, which paid a reported $18 million for the site in 2013 and subsequently got the now-empty land entitled for the industrial project.
Terms of the latest sale weren’t immediately disclosed. Sources familiar with the transaction said the property likely changed hands in the $26 million range, or roughly $1.5 million an acre.
Retail Investments
Costa Mesa-based shopping center owner Donahue Schriber Realty Group tapped a pair of frequent investors to raise another $250 million for acquisitions.
The privately held real estate investment trust said it got a $250 million equity investment from institutional investors advised by J.P. Morgan Asset Management and the New York State Teachers’ Retirement System.
Each investor provided $125 million in capital, which will fund acquisitions focused on grocery-anchored neighborhood and community shopping centers in California and the Pacific Northwest.
J.P. Morgan and the New York pension fund have now invested $450 million of growth capital with Donahue Schriber, according to the company, which has announced several acquisitions since the start of the year.
Recent deals include the estimated $111 million purchase of a recently built shopping center in San Jose, and an estimated $33 million purchase of a Whole Foods-anchored center in Berkeley that runs 91,300 square feet.
Donahue Schriber estimates its retail portfolio of 70 shopping centers is now valued at about $3 billion.
New York State Teachers Retirement System, one of the 10 largest public retirement systems in the country, now owns about 40% of the retail investor, with a stake valued at about $523 million, according to a recent report in trade publication Investments & Pensions.
