IRVINE, Calif. – March 13, 2017 – Cushman & Wakefield announced today that The Kutzer Company and OPC Acquisition 2, LLC has sold the leasehold interest in the 110,322 square foot Lake Forest Marketplace shopping center in Lake Forest (Orange County), Calif. A high net worth individual acquired the leasehold interest for $9 million. Dixie Walker and Charley Simpson with Cushman & Wakefield’s Retail Services group in Irvine represented the buyer and seller in the transaction.
Lake Forest Marketplace is an institutional quality neighborhood retail center situated on two parcels totaling 8.82 acres. Located at 23771 El Toro Road, the center was 100 percent occupied by 22 tenants. Approximately 75 percent of the property’s gross leasable area (GLA) includes nationally and regionally recognized retailers such as 99 Cents Only, Guitar Center, Harbor Freight Tools, Bank of America, UPS Store, Metro PCS, and newly signed Del Taco and Dunkin’ Donuts.
Lake Forest Marketplace is prominently located at one of the busiest intersections in the very desirable South Orange County market, at the northwest corner of El Toro Road and Rockfield Boulevard, just east of the Interstate 5 freeway. El Toro Road and Interstate 5 marks the core of the primary retail corridor that serves the densely populated and affluent residential communities of Lake Forest, Irvine, Mission Viejo, Laguna Hills, and Laguna Woods.
Mr. Walker, a Managing Director at Cushman & Wakefield, said, “Lake Forest Marketplace provided an excellent opportunity for an investor to achieve very attractive cash returns over the next three decades by owning the leasehold interest in this very prominent shopping center. Long term stabilized tenancy and irreplaceable location with significant barriers to entry make this a high quality long term investment.” He added, “More than 60 percent of the incoming stream is generated by the nationally recognized tenants and over 70 percent consists of tenants who have been at the center for over 10 years indicating the strength of the South Orange County location.”
Lake Forest Marketplace is located within the very desirable South Orange County retail submarket. With a current vacancy rate of only 4.1 percent, the South OC retail submarket has a lower vacancy rate than the Orange County market at 5.1 percent, Los Angeles County at 6.1 percent and the regional west coast vacancy rate of 8.6 percent, according to Reis, Inc. As the vacancy rate continues to drop, with no new supply in the immediate future, the average asking rate has increased over 16 percent from $24.60 PSF/Year in Q4-2010 to a current rate of $28.56 PSF/Year.
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