A 51,000 square foot building with extensive food production improvements is available for lease at $1.45 per square foot triple net in the the southern section of the City of Los Angeles near the 405 and 110 freeways.
The building shell is modern concrete tilt up and the food processing improvements were installed in recent years and include: refrigerated production meal prep room, cooler, floor drains, and freezer. The space was used for airline meal preparation. There are 80 parking spaces and 1,600 AMPS of power.
This is a great opportunity for an investor to purchase a multi-tenant industrial property, add some value by sprucing it up and leasing it out to multiple tenants. The asking price is very reasonable considering there are almost no properties that can compete with the many cool factors of these buildings and especially the large amount of parking estimated at 130 spaces.
An investor would be hard pressed to find a property with the large parking ratio offered here. This is very important if you intend to attract creative tenants from the DTLA Arts District.
The property suits a regular distribution warehouse use well given it has 9 truck high dock loading positions and that can be expanded by perhaps 5 more doors. The heavy power of 1,600 amps is attractive to a manufacturer or cannabis industry user.
Only 10 minutes south of Downtown Los Angeles Central Business District and 5 minutes east of the 110 Freeway. Easy access to the Ports of L.A. Near Alameda St. and the City of Vernon.
This new listing should prove interesting to all types of buyers including 1031 Tax Deferred Exchange buyers. Plus the Opportunity Zone location allows for Federal tax benefits by reducing or eliminating capital gains upon a sale in later years.
With an industrial base of over 1 billion square feet , the Los Angeles industrial market is one of the largest in the United States. It also has some of the highest asking rental rates, $0.95 per square foot, as well as one of the lowest vacancy rates (2.4%) in the nation. In recent quarters, net absorption has been soft, mainly due to lack of available inventory. Imports at the twin ports of Los Angeles and Long Beach, which handle roughly 40% of all imports into the country, continue to be a major industrial driver for the region. In addition, the region is the largest manufacturing center in the United States. For perspective, LA has more manufacturing jobs than the entire state of Illinois . Consequently, demand is still very strong. Although developers are attempting to keep pace with demand, they are not able to do so because of the scarcity of buildable land. Total warehouse square feet under construction fell from 5.4 MSF in 2018 to just 4.7 MSF in 2019. Investors love the potential for rent growth and low vacancy in tight markets and they have been aggressively securing deals with a willingness to accept lower returns for the stability and upside potential of the Los Angeles market. Approximately $3.80 billion worth of industrial real estate traded hands in Los Angeles in 2019, setting a new high water mark for the region.
According to a recent Los Angeles Times article, Los Angeles County was the largest county by output, with its $710.9 billion GDP accounting for 3.8% of the U.S. total. L.A. County added $395.2 billion to total U.S. GDP from 2001 to 2018.
This is good news for industrial real estate values!
Below is a chart showing the average sale price per square foot of industrial building area sold over the last 12 years in the Central Los Angeles industrial submarket. The $/SF dips on the left side due to the Great Recession and then continues its upward march to over $200/SF in 2019.
The data includes industrial zoned properties which include warehouses and manufacturing buildings with a small fraction converted to creative uses in the DTLA Arts District. The majority represent typical industrial uses around DTLA and Vernon and Commerce and Montebello. The data below are only an average as prices can vary greatly depending on building features and location.