CRE investment sales in LA sank like a stone in May

The sector saw an 80% dropoff from 2019, though demand for industrial space remained strong

TRD LOS ANGELES /
Jun.June 30, 2020 12:00 PM
Brookfield Asset Management CEO Bruce Flatt and Woodridge CEO Michael Rosenfeld with 101 S. Marengo Avenue, and a rendering of the building (Credit: Google Maps)
Brookfield Asset Management CEO Bruce Flatt and Woodridge CEO Michael Rosenfeld with 101 S. Marengo Avenue, and a rendering of the building (Credit: Google Maps)

Just how devastating has the coronavirus crisis been for Los Angeles commercial real estate investment sales?

In May, just $332 million in commercial properties sold in L.A. County compared to $1.66 billion in sales volume for May 2019, the Los Angeles Business Journal reported, citing Newmark Knight Frank figures.

That’s an 80 percent dropoff, registering the coronavirus’ full impact.

While retail, multifamily and office deals were down, demand has remained relatively strong for industrial property. More industrial space has traded hands since March than did over the same period last year: 18 million square feet compared to 15 million square feet, the Journal reported.

There were some decent-sized office deals that closed in May. A 15,000-square-foot office building in Pasadena traded for $72 million, while early in the month. another Pasadena complex sold for $78 million.

In early June, Brookfield Asset Management closed on a purchase of two Carson industrial buildings for $64 million in a leaseback transaction. Also in June, there was a $530 million deal for five hydrogen plants in Torrance. Dairy Farmers of America also bought two properties in the City of Industry from Dean Foods Co. as part of a $433 million portfolio deal, according to the report.

And this week, Hudson Pacific Properties announced it would sell a 49 percent stake in three Hollywood production studios to Blackstone Group in a deal valued at $1.65 billion, according to the Los Angeles Times. Last week, the Wall Street Journal reported the deal was in advanced talks. It includes Sunset Bronson, Sunset Gower and Sunset Las Palmas studios that combined, have about 1.2 million square feet, according to the Los Angeles Times. [LABJ]Dennis Lynch


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