Four single-tenant net-leased investments at a newly developed Grocery Outlet-anchored shopping center in the unincorporated Greater L.A. area of Rosamond traded in separate deals totaling $19.3 mil. The new construction properties were occupied by Grocery Outlet, Starbucks Drive-Thru, 7-Eleven and O’Reilly Auto Parts.
Bill Asher and Jeff Lefko with Hanley Investment Group Real Estate Advisors represented the developer and seller, a partnership between Halferty Development Company LLC in Pasadena and Net Lease Alliance, in all of the transactions.
In one of the deals, a private partnership based in San Diego paid $7.08 mil for a 2021-construction, single-tenant, 16k sf Grocery Outlet on 1.64 acres at 2550 Rosamond Blvd, in an all-cash 1031 exchange purchase. The buyer was represented by Mike Conger of CAA in San Diego.
The sale came in at a cap rate of 4.75%, a record-low cap rate for a Grocery Outlet in Southern California. According to Asher, the deal closed in 30 days at 100% of the asking price.
Based in Emeryville, Grocery Outlet is a high-growth, extreme value retailer of quality, name-brand consumables and fresh products sold through a network of independently operated stores. Grocery Outlet has more than 410 stores in California, Washington, Oregon, Pennsylvania, Idaho and Nevada.
In another transaction, a private investor based in Los Angeles County paid $3.5 mil for a 2021-construction, single-tenant, 2.2k sf Starbucks Café and Drive-Thru on 0.83 acres at 2544 Rosamond Blvd. The buyer, a private investor based in Los Angeles County, was represented by Joey Kim of eXp Realty in Irvine repped the buyer in the deal, which came in at a cap rate of 4.29%, a record-low cap rate for a Starbucks in Kern County in the past 48 months.
A private investor based in San Diego County paid $5.56 mil for a 2021-construction, single-tenant, 3.1k sf 7-Eleven convenience store with a gas station on 0.98 acres at 2536 Rosamond Blvd. Lindsey Kalal of Kalal Investment Realty in Coronado, CA represented the buyer in the deal, which closed at a cap rate of 4.45%, a record-low cap rate for a build-to-suit 7-Eleven convenience store and gas station in Antelope Valley.
And in the fourth transaction, a Glendale, CA-based private investor paid $3.2 mil for a 2021-construction, single-tenant, 7.2k sf O’Reilly Auto Parts store on 1.01 acres at 2540 Rosamond Blvd. The transaction closed at a cap rate of 5.06%, a record-low cap rate for a single-tenant O’Reilly Auto Parts in the region. The all-cash, 1031 exchange buyer was repped by Mark Hong of Korus Real Estate of Los Angeles.
Located in Kern County, the Grocery Outlet-anchored shopping center is ideally situated adjacent to the 14 Fwy on/off-ramps, benefiting from 30,000 cars per day and serves the nearby Edwards Air Force Base, the second largest base in the Air Force, which spans 481 square miles with more than 10,000 military, federal civilian and contract personnel. The retail center also has prominent freeway-visible pylon signage that provides excellent exposure traveling north and south along the 14 Fwy.
“Retail investors continue to want the security of a well-located, new construction single-tenant net-leased retail asset with a long-term lease with a national credit tenant that is internet-resistant,” said Asher. “Significantly increased buyer demand has fueled record prices and compressed cap rates for the best-in-class, net-leased retail assets. We expect the current high level of investor appetite to continue in 2022.”