An affiliate of the biggest beer wholesaler in the nation has bought one of Huntington Beach’s largest buildings, where it plans to expand its local distribution operations.
The unit of Rosemont, Ill.-based Reyes Beverage Group last week completed the purchase of 5901 Bolsa Ave., a 493,000-square-foot industrial building at Springdale Street and Bolsa.
The property, located a mile west of the San Diego (405) Freeway, is the largest industrial building in Huntington Beach that’s not owned and occupied by The Boeing Co.
The property changed hands at a price near $55 million, or a little more than $111 per square foot, according to sources familiar with the transaction.
Irvine-based LBA Realty was the seller.
Record Sale
The transaction is the largest single-building industrial sale reported in Orange County this year.
A $55 million estimate also would make it the largest industrial sale involving an owner-user that the local market has seen in close to 10 years, according to Louis Tomaselli, senior managing director for the Irvine office of commercial brokerage Jones Lang LaSalle.
The building is currently empty, and Reyes Beverage is expected to put it to use shortly.
The property has about 94,000 square feet of office space in addition to its warehouse and distribution areas.
It’s not known whether the buyer plans to use all of that office space for its own operations.
The distributor made the purchase as part of its expansion plans in and around Orange County.
“They had been in the market for a long time” and had explored buying other buildings in Anaheim and Huntington Beach for their operations, according to Tomaselli.
The buyer could not be reached for comment, and brokers directly involved in the deal were unable to comment, citing confidentiality agreements.
Reyes Beverage is the largest beer distributor in the U.S., according to trade publication Beverage Executive.
The company distributed about 93 million cases of beer and had sales of $1.9 billion in 2011, the most recent data available on the privately held company.
That’s more than twice the sales of its nearest competitor, according to the trade publication’s annual rankings of beer distributors.
Harbor Distributing
The company’s Southern California division runs under the Harbor Distributing LLC name. That division sells more than 20 million cases of beer to more than 5,600 accounts across 800 square miles, according to Reyes Beverage’s website.
Harbor Distributing joined Reyes Holdings in 1989 as a 4-million-cases-per-year business in the South Bay of Los Angeles.
It has since expanded its service territory into OC.
Some suppliers to Harbor Distributing include Miller Brewing Co., Boston Beer and Sierra Nevada.
The buyer of the Bolsa Avenue building is listed in property records as Harbor Distribution/Reyes Family Holdings.
A unit of Reyes also owns a nearly 90,000-square-foot building along Lewis Street in Anaheim, and is said to occupy other area properties. It’s not known whether the company plans to vacate those buildings when it moves into the Huntington Beach location.
The sale represents a big win for LBA Realty, which paid about $38 million for the Bolsa Avenue building in 2011.
Sharp Electronics
The property was previously owned and occupied by Tokyo-based Sharp Electronics Corp.
Sharp bought the 24-acre site in the late 1990s for a reported $10 per square foot and built the property, which housed the company’s solar systems division.
That division ran the sales, marketing and engineering of Sharp’s solar energy products in North and South America.
Sharp moved the building’s warehouse operations to the Inland Empire in 2010 and last year moved its remaining local staff from Huntington Beach—where it had operated under a short-term lease following the sale to LBA—to Lakeside Tower in Santa Ana.
LBA had been exploring whether to lease or sell the building for a tenant or owner since its 2011 purchase of it.
Jeff Chiate and Rick Ellison, executive directors for the Irvine office of Cushman & Wakefield Inc., represented LBA in the sale. Mike Hartel, senior vice president for the Irvine office of Voit Real Estate Services, represented Reyes Holdings in the transaction.
The deal takes one of the largest empty industrial buildings in Orange County off the market.
It single-handedly cut the city’s vacancy rate for industrial buildings to about 8.6%, compared to 17.8% before Reyes Holdings took over the building, according to Jones Lang LaSalle’s latest figures.
Other Distributors
Beverage distributors have made some of OC’s largest industrial deals in the past few years.
Last year, Sacramento-based Nor-Cal Beverage Co.—one of the largest bottlers and packers of juices, energy drinks and other beverages on the West Coast—leased 244,800 square feet at a distribution center on East Lambert Road in Fullerton.
In 2010, Straub Distributing Co., which distributes beer and other beverages for Anheuser-Busch InBev SA, leased 281,548 square feet of space on La Palma Avenue in Anaheim and moved its headquarters from Tustin to the new location.
