A Los Angeles-based real estate investor is looking to sell some recently bought Brea industrial buildings that long have served as the local operation of building products maker Simpson Manufacturing Co.
In July, Cohen Asset Management Inc. paid $14.7 million for the Brea buildings in one of the larger industrial transactions in North Orange County this year.
The six buildings, in Brea’s industrial corridor between Lambert Road and Imperial Highway, total about 231,000 square feet.
They range in size from about 20,000 square feet to 69,000 square feet.
Cohen paid about $65 per square foot to buy the buildings from Simpson Manufacturing, which saw a $5.2 million gain on the sale.
Now Cohen is looking to make a profit with a quick sale of the buildings. If sold individually at the prices Cohen’s expecting, the buildings could generate nearly $25 million this time around.
Pleasanton-based Simpson Manufacturing, which makes connectors, anchors and other products used in construction, said earlier this year it was relocating its Brea operations to San Bernardino in 2011.
For now, the company leases the Brea manufacturing and warehouse buildings from Cohen in a short-term leaseback deal for nine to 12 months.
The company, which also operates under the Simpson Strong-Tie Co. name, has been in Brea since the 1970s.
Simpson started with one Brea building and expanded to five others nearby as its operations grew, according to Tom Dorman, first vice president with the Anaheim office of CB Richard Ellis Group Inc., which represented the company in the July sale.
The buildings are at the corner of North Palm Avenue and Moonstone Street near the Orange (57) Freeway.
Simpson’s Move
Operating out of multiple midsize buildings wasn’t effective for Simpson, which had been looking to consolidate local operations for a while, Dorman said.
The company paid a reported $19.2 million in March for a 400,000-square-foot building in San Bernardino. In addition to the Brea operations, the company’s relocating a warehouse in Ontario to the new building.
Most of Simpson’s local employees—many of whom already live in the Inland Empire—are expected to make the move to San Bernardino.
Simpson employs about 2,100 people worldwide. The publicly traded company had a recent market value of about $1.3 billion.
Buyer’s Plan
The acquisition was the first locally in a few years for private- ly held Cohen, whose backers include wealthy people and institutional investors.
Cohen’s plan is to market the individual buildings for sale to company owners looking for a place to house their businesses.
It’s hoping to get a couple sales at the project—now called the Brea Canyon Commerce Center—done by year’s end.
Early marketing plans show the buildings are being offered at prices ranging from $98 per square foot for the largest two buildings to $123 per square foot for the smallest buildings.
What’s known as the owner-user market is one of the more active sectors of the commercial real estate market right now, especially for businesses using Small Business Administration financing in their deals, according to Dorman.
He’s handling the sale of the buildings along with CB Richard Ellis’ Ian Britton.
There has been some interest in the buildings from prospective owners, though the brokers have yet to begin active marketing, Dorman said.
Each building is either available now or will be refurbished at the end of Simpson’s short-term lease, according to the brokers.
