Optimus Properties has landed a $21.5 million loan to refinance a 77,100-square-foot shopping center in South Los Angeles for $292 per square foot — double what some Class A offices fetch in Downtown L.A.
The Century City-based secured the loan tied to the Juanita Tate Marketplace at 1040 Slauson Avenue, in Florence, the Los Angeles Business Journal and Los Angeles Times reported.
Financial terms of the five-year loan by unidentified institutional investors advised by J.P. Morgan Asset Management were not disclosed. Brokers Alex Olson and Daniel Skerrett of JLL Capital Markets handled the loan.
The retail center, anchored by a 42,500-square-foot Northgate Market, is 100 percent leased by such tenants as CVS, Panda Express, Starbucks and Chase Bank. Since it opened in 2014, the marketplace has had an average occupancy above 95 percent.
Optimus bought Juanita Tate Marketplace a decade ago for an undisclosed price.
Juanita Tate Marketplace is named after Juanita Tate, an activist who fought for housing equity in South L.A. and founded the nonprofit Concerned Citizens of South Central Los Angeles.
It was built on an old scrap metal plant and faced major hurdles getting off the ground, including a legal battle after the city’s eminent domain-driven seizure of the property, according to the Business Journal.
The property is located within a densely populated area, with 1.2 million people residing within a 5-mile radius. Prior to the marketplace, the closest grocery-anchored center to the neighborhood was 2.5 miles away, leaving residents with limited access to food.
“Juanita Tate Marketplace represented an exceptional and unique investment opportunity in one of the densest parts of Los Angeles,” Olson said in a statement. “The property has a fascinating history, which included eminent domain development to remedy a longstanding food desert and a 17-year escrow process.
“Strong anchor tenants, diverse mix of national retailers, the strategic location and strong sponsorship contributed to its appeal in securing favorable financing terms.”
The refinancing deal in South L.A. at nearly $300 per square foot contrasts with Downtown L.A., where formerly prestigious office buildings have traded for as low as $120 per square foot after a pandemic shift to remote work cratered the office market.
Optimus, founded in 2007 by brothers Kamyar and Joseph Shabani, has almost $1 billion in assets under management, according to a release from Institutional Property Advisors.
Last July, Optimus sold a 60,800-square-foot office building with approved plans to replace it with a 272-unit apartment complex in Torrance for $30.6 million.
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