Shopoff Realty Investments Buys 55 Acres for SoCal Industrial Development
By Nick Trombola June 11, 2024 2:12 pm
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Industrial vacancy rates in Southern California’s Inland Empire are on the rise after years of record lows, but nobody tell Shopoff Realty Investments.
The Irvine, Calif.-based real estate investment firm has purchased a 55-acre parcel in the the city of Desert Hot Springs, about 12 miles north of Palm Springs, with the intent of building a nearly 1.1 million-square-foot warehouse and distribution center.
Details on the property’s seller, price and specific address were not disclosed, and a spokesperson for Shopoff could not immediately be reached. An announcement of the sale indicated that it was near Interstate 10, making it well positioned for access to Southern California ports and the interior of the West Coast.
“Considering last year’s sale of our I-10 Logistics Center in Cherry Valley, it’s safe to say we are bullish on industrial, and specifically projects on the I-10 corridor,” said Shopoff President and CEO William Shopoff in a statement. “This Desert Hot Springs project represents a rare opportunity to acquire a property that is already entitled and ready for development, in an area with significant demand from e-commerce companies for logistics and warehouse space.”
Construction on the sprawling warehouse space is expected to begin later this year, with completion estimated in the third quarter of 2025. Once finished, the development will span 1,061,090 square feet, with 167 docks and nearly 500 trailer stalls, per Shopoff.
“With neighbors such as Amazon (AMZN) and Fedex, this location has the potential to provide a great investment for many years to come and will offer third-party logistics companies significant drayage savings compared to projects in Arizona and Las Vegas,” Shopoff added.
Shopoff will start marketing the property to potential tenants before construction ends, according to the firm, with Ian DeVries and Chris DeVries of Colliers (CIGI) International and Brad Yates and Stefan Pastor of Stream Realty in charge of brokerage.
While still the reigning king of U.S. industrial markets with well over 700 million square feet, the Inland Empire entered a new era of waning sales and rising vacancy rates earlier this year due in large part to record levels of construction.
Total dollar volume of industrial sales in the region plunged by 44 percent annually in 2023, according to data released by brokerage firm NAI Capital. Largely driven by the more than 28 million square feet of space delivered throughout 2023, the region’s industrial vacancy rate meanwhile hit 5.7 percent by the end of last year, its highest point since 2013.
Nick Trombola can be reached at ntrombola@commercialobserver.com.
