Penwood Real Estate Investment Management is adding a Southern California industrial property to its portfolio after taking a 13-acre site in Los Angeles County.
The 230,000-square-foot structure sold for $69.8 million, according to a source familiar with the deal. The building includes storage, food processing and distribution improvements at 5743 Smithway Street in the city of Commerce, southeast of Downtown L.A.
Cushman & Wakefield’s Tim Wallace represented Penwood and announced the deal, but did not disclose the sales price. CBRE’s Art Rasmussen, Ryan Lin and David Norrie represented the seller, Smithway Associates, which first acquired the property in 1988, records show.
The property is surrounded by 3.4 million people within a 10-mile radius, and has immediate access to Interstates 5 and 710. Wallace said the property “offers flexibility in the future reposition strategy via adaptive reuse and industrial redevelopment.”
“When combined with the proximity to prominent neighbors like The Citadel Outlets, a 700,000-square-foot mixed-use retail-entertainment destination, and The Commerce Casino & Hotel, located directly across the street, the industrial location provides current and future users with a host of amenities and advantages not easily replicated in the Central Los Angeles market,” Wallace said.
Southern California has been particularly competitive for tenants seeking increasingly scarce industrial space, especially in e-commerce as shopping trends have shifted since the beginning of the pandemic. C&W recently determined that the boom in demand for e-commerce service would continue to drive rents in such facilities for the next two years.
Penwood and Shubin NadalRealty Investors also recently sold a 182,630-square-foot industrial building in the Inland Empire for $70 million.
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