One of the priciest per-square-foot industrial deals of the last decade has closed in Torrance, and it’s no surprise that Amazon factors in.
Realterm US paid $81 million for a 118,000-square-foot former Costco wholesale store now undergoing a renovation and upgrade, according to the Los Angeles Business Journal.
The price pencils out to $548.33 a foot, more than twice the average for the area.
Amazon is leasing the space at 2751 Skypark Avenue that it will use as a warehouse, according to the report. About 12,500 square feet will be used for office and reception space.
The seller was Bridge Development Partners. The deal is nearly twice the $41.3 million that Bridge paid for the property last November.
Bridge secured approval from Torrance to demolish the existing building to make way for a new development, but scrapped those plans to renovate the existing property for Amazon. The firm recently filed for another ground-up development outside Torrance.
The L.A. industrial market was the strongest in the country before the coronavirus pandemic and has continued to tighten throughout the year. That’s thanks in part to increased demand for logistics space from e-commerce companies like including Amazon, which said it planned to open 100 new distribution centers in September, which posted record earnings in the second quarter. That’s generally true of the wider national industrial market. Industrial real estate investment trusts, for example, have generated consistent returns where most other specialty REITs have lost value. [LABJ] — Dennis Lynch