CenterPoint Closes Nearly $200M Industrial Acquisition in L.A.’s South Bay
JPMorgan owned the four buildings that total less than 550,000 square feet
By Greg Cornfield February 28, 2024 1:30 pm
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An industrial real estate investment firm based in Illinois is gobbling up warehouse space in the submarket around the ports of Long Beach and Los Angeles in Southern California.
CenterPoint Properties has put down $197 million for a four-building portfolio spanning 546,866 square feet in Los Angeles’ South Bay. JPMorgan Asset Management owned the properties since the mid-1990s, records show. CenterPoint announced the deal but did not disclose the value of it nor the name of the seller. Sources familiar with the trade confirmed the price at over $360 per square foot.
“It’s rare to have the opportunity to acquire this type of scale in the South Bay,” Evan Lippow, CenterPoint’s senior vice president of investments in the West, said in a statement. “These four assets are synergistic with our existing portfolio and align with the CenterPoint investment strategy of accumulating scale in the premier infill logistics markets in the country.”
The four facilities are in Compton — at 1111 West Artesia Boulevard, 711 West Walnut Street, 1620 South Wilmington Avenue and 425 Carob Street — and feature 113 dock-high loading positions, 12 ground-level loading doors, and secure yards.
Much like the rest of the nation, the industrial property vacancy rate in Greater L.A. has been ticking up, and hit about 5.6 percent in January, double the 2.8 percent logged in January 2023, according to data released Tuesday from CommercialEdge. That being said, Southern California is still home to the highest industrial rent increases in the nation, with L.A. rates increasing more than 12 percent year-over-year.
The Compton acquisition increases CenterPoint’s South Bay portfolio to 30 total assets, along with two active development projects. And the firm’s leaders said they are committed to investing more capital in the submarket.
“The South Bay submarket has an established track record of low vacancy, high rental growth and high barriers to entry for new development,” added Bob Andrews, CenterPoint’s West Region senior vice president of asset management.
CBRE (CBRE)’s Darla Longo, Michael Longo, Joe Cesta, Eric Cox and Barbara Perrier brokered the transaction.
“The portfolio is located in one of the strongest industrial markets in the country, less than 13 miles from the ports of Los Angeles and Long Beach and with direct access to routes servicing the West Coast,” Michael Longo said in a statement. “South Bay is supply constrained with little vacancy, and this asset represents a truly unique investment opportunity in an exceptionally strong rent growth market known for quality tenants and high retention.”
The JLL (JLL) team of Zac Sakowski, Danny Reaume and Rustin Mork led CenterPoint’s leasing efforts.
Gregory Cornfield can be reached at gcornfield@commercialobserver.com.
