Leases  ·  Sales

Walgreens Closes $112M Sale-Leaseback in Riverside County

Retailer signed a 15-year lease with three 10-year extension options

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Walgreens has cashed in on the demand for warehouse space in Southern California by selling a large distribution center and leasing it back in a long-term deal.

The major retail chain sold its 692,600-square-foot facility in the Inland Empire for $111.7 million in a deal that closed Jan. 4, according to data provided by Vizzda. An entity run by Easton Manson, who manages The Malulani Group and Persis Corporation, acquired the property.

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Walgreens will remain at the property after signing a 15-year lease with three optional 10-year extensions.

The asset was built in 2004 over 92 acres at 17500 Perris Boulevard in Moreno Valley. It’s in a pocket of industrial buildings between the Perris Reservoir and March Air Reserve Base, alongside distribution centers for other companies such as Amazon, FedEx and Home Depot.

The Inland Empire’s industrial market softened in 2023 thanks to record-high levels of construction — including an unprecedented 14.8 million square feet completed in the fourth quarter — which raised the overall vacancy, according to an NAI Capital report released Thursday. Approximately 5.7 percent of the current inventory is unused, the highest vacancy level in 10 years.

Gregory Cornfield can be reached at gcornfield@commercialobserver.com.