UPDATED, Oct. 25, 2022, 9:29 a.m.: Onni Group is taking advantage of distress, buying up a Pasadena shopping center after a Dallas-based firm defaulted on a loan connected to the property.
The Vancouver-based developer bought the 457,000-square-foot The Paseo complex, at 280 East Colorado Boulevard, for $103 million through a foreclosure, according to a Monday release from Newmark. A team led by Newmark’s Dustin Stolly and Jordan Roeschlaub brokered the deal.
The property was formerly owned by a limited liability company called CAPREF, which defaulted on a loan connected to the property earlier this year, according to documents filed with L.A. County in June. Granite Point had provided CAPREF with the loan in 2018. The price works out to about $225 per square foot.
Records show CAPREF is linked to Dallas-based EB Arrow, an investment firm run by Todd Minnis.
CAPREF owed $118 million on the loan, as of Sept. 30, prompting foreclosure proceedings. Neither nor Onni responded to requests for comment.
Onni also scored a bargain as CAPREF paid $135 million for the complex in 2016, records show. That makes Onni’s price a 24 percent discount from the amount paid six years ago.
The Paseo, an outdoor shopping center located in Downtown Pasadena, is home to a mix of upscale and mid-tier brands, from Equinox to H&M and Designer Shoe Warehouse.
Few retail property owners have defaulted across L.A. County in recent months, despite the pandemic’s impact on stores.
However, in light of rising inflation and a potential pullback in consumer spending, defaults may be on the horizon, according to S&P Global.
In July — shortly after the previous owner defaulted on its loan — S&P said retail companies were at the highest risk of default, according to an index it uses to measure risk.
“Investors [are pricing in] a higher risk amid a growing concern of rising inflation and a potential slowdown in the U.S. economy,” S&P said in its report.
While other investors might be sitting on the sidelines, Onni Group is plowing ahead with development plans and acquisitions across L.A.
Earlier this month, the firm bought a commercial site near the Expo Line for $65 million — land that is already entitled for 129 units.
A previous version of this story incorrectly named NETSTREIT as the former owner of The Paseo. The former owner is CAPREF LLC.
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