June 5, 2019– Stos Partners, a privately held commercial real estate investment and management firm, has announced the sale of two assets, including a two-building, 170,805 square-foot industrial property in Chula Vista and a one-building, 50,643 square-foot office property in San Dimas, California.
Stos Partners acquired the Chula Vista asset in July of 2017 for $13.45 million, implemented $1 million in capital improvements, and sold it on May 31, 2019 for $24.4 million. The firm acquired the San Dimas asset in March of 2017 for $5 million and sold it on May 14, 2019 for $9.06 million with minimal improvements.
“These two dispositions reflect the depth of value creation our firm is capable of achieving,” says CJ Stos, Principal of Stos Partners. “By taking each asset full cycle and achieving value increases of 69 percent and 81 percent respectively, within an approximate two-year hold period, we continue to prove that our investment strategy is well-honed and well-timed.”
Stos notes that his firm continues to be an extremely active buyer and seller in the Southern California market, drawing upon its track record and surety of close to complete both off- and on-market transactions that fit the firm’s value-add criteria.
The firm’s recent sales include:
Stos Sells Chula Vista Asset for $24.4 Million
Stos Partners sold two industrial buildings located at 1670 and 1690 Brandywine in Chula Vista, California to a large institution for a total consideration of $24.4 million.
The property, which was initially acquired by Stos Partners through an off-market transaction in 2017, underwent an extensive capital improvement campaign during Stos’ ownership, including new paint, roofs, landscaping, signage, and parking lots.
“We recognized early on that this asset was located in a path of growth, and thereby had a tremendous amount of unrealized value,” notes Jason Richards, Partner at Stos Partners. “Though institutional investors were not buying in this area when we first acquired the asset, we realized that this submarket would soon be palatable to institutions seeking stable, recently improved assets in which to invest.”
During its ownership, Stos Partners leased a vacancy to a strong national tenant and secured a long-term lease renewal with one of the existing tenants, increasing the property’s appeal to institutional buyers.
The asset is demised into six industrial units ranging in size from 25,000 to 55,000 square feet, and is leased to a mix of national credit, regional credit, and local companies.
Bryce Aberg, Jeff Cole, Jeff Chiate and Brant Aberg of Cushman & Wakefield and Michael Mossmer of Voit Real Estate Services represented Stos Partners as the seller in the disposition.
Stos Achieves 81 Percent Value Increase With San Dimas Office Sale
Stos Partners has also sold a two-story, 50,634 square-foot office building located at 650 W. Cienega in San Dimas, California, to a trade union that will use the facility as an owner-user.
“This was an opportunistic purchase we made in early 2017 that provided tremendous upside potential based on the property’s strong fundamentals,” explains CJ Stos. “The single-tenant building had been fully occupied by a vocational school; however, the prior owner underwent a bankruptcy and the property was placed in receivership. Based on a close broker relationship, our team was able to make the first offer, secure the property, and close quickly, achieving a price that was less than half of the estimated replacement cost.”
During its ownership, Stos Partners implemented minor improvements and repositioned the property, focusing on the asset’s strong freeway location and its exceptionally high 6.52 per 1,000 parking ratio to identify the right buyer.
“We understood that a building with this parking ratio was a rare find, and we recognized the opportunity to achieve a premium price for the asset in this market,” says Stos. “Ultimately, we achieved a sale price of $9.06 million – an 81.2 percent value increase from our initial purchase price of $5 million.”
The property is located on the east side of the 57 freeway in the San Gabriel Valley of Los Angeles County. Taylor Ing at Newmark Knight Frank represented Stos Partners as the seller in the transaction. Brandon Burns with Cushman & Wakefield represented the buyer.