January 11, 2018- Hanley Investment Group Real Estate Advisors, a nationally recognized real estate brokerage and advisory firm specializing in retail property sales, announced today that the firm has completed the sale of a 9,000-square-foot multi-tenant pad building in Fontana, California. The property, which is located adjacent to the Interstate-15 freeway on/off-ramp at Baseline Avenue, sold for the list price of $3,856,072.
Hanley Investment Group’s Executive Vice President Eric Wohl and Associate Andrew Cunningham represented the seller, Pacific Development Group of Newport Beach, California. Pacific Development Group is known as one of the preeminent shopping centers developers in California and has been responsible for the development of over 300 shopping centers ranging from small strip centers to large one million-square-foot community shopping centers. The buyer, a private investor from northern California, was represented by Allen Dieu of GD Commercial Real Estate, Inc. of Milpitas, California.
Built in 2002 on 0.53 acres, the 100-percent-occupied, six-tenant building features tenants Rosa Maria’s Mexican Restaurant, a hair and beauty salon, nail salon, barbershop, and a convenience/liquor store. Credit tenants in the immediate trade area include Starbucks, Jack in the Box, Denny’s, KinderCare, Vons, Wells Fargo, AutoZone, Wendy’s, Panda Express, US Bank, Logan’s Roadhouse, KFC, and Chase Bank.
According to Wohl, 73 percent of the tenants have occupied the property for 15+ years and all tenants have between 3 percent to 10 percent annual rent increases providing an ideal hedge against inflation. The tenants also have staggered lease expirations, which minimizes the property owner’s exposure to tenant turnover.
“This is a quality Inland Empire location with a strong operating history. The property benefits from high traffic counts and dense, affluent demographics and significant projected population growth,” said Wohl. “It is positioned directly on Baseline Avenue at the I-15 on/off ramp, which is expected to see an increase of 250-300 percent in traffic flow over the coming years. By 2021, the one-mile population is expected to increase by 20 percent. Currently, there are more than 118,000 people within a three-mile radius and an average household income in excess of $110,000 within a one-mile radius.”
Cunningham said that the buyer was in a 1031 exchange trading out of a residential property and the sale achieved the lowest cap rate and highest price per square foot for a retail strip center consisting of local credit tenants in San Bernardino County. “This transaction represents the continued investor demand for retail real estate assets located in the booming Inland Empire market,” Cunningham noted.