Irvine, Calif. – May 10, 2017 – Passco Companies , a privately held Calif.-based real estate company that specializes in the investment, acquisition, development and management of commercial properties throughout the U.S., has acquired Temescal Village, a 102,976 square-foot neighborhood shopping center in Corona, California, for $16.95 million. A retail brokerage team led by Dixie Walker and Charley Simpson of Cushman & Wakefield’s Irvine office represented the seller, a private investor, in the transaction.
“Temescal Village is a prime retail asset with strong value-add potential,” says Todd Siegel, Vice President of Retail Acquisitions for Passco Companies. “The retail center is located in a densely populated residential community along the 15 freeway in a market with significant barriers to entry for new retail supply and incredibly low retail vacancy.”
According to Siegel, at the close of Q4 2016, the immediate corona retail market had a vacancy rate of 4.4 percent. “This is one of the lowest vacancy rates we’ve seen throughout the region,” he explains noting that it is lower than the vacancy rates of the Inland Empire, Orange and Los Angeles counties.
Located at 1181-1199 Magnolia Avenue and built in 1983, Passco plans to modernize the property through a series of strategic renovations and capital improvements. Planned renovations include redesigning the landscaping and updating the façade throughout the center, as well as adding a variety of social gathering, outdoor dining, and seating areas throughout the center.
“There continues to be a major push within the retail industry for centers that cultivate the ultimate experience for shoppers,” says Siegel. “Shoppers today are demanding environments where they can gather and socialize with friends and family. We plan to integrate these social components into the center by incorporating more outdoor seating and gathering spaces for shoppers.”
Siegel adds, “In doing so, we will be able to increase foot traffic to the center, as well as attract and retain high-quality retailers. This will drive the long-term value of the asset and allow us to grow rents as leases roll. Many of the current tenants have been located at the center since the 1980s and have rents that are well-below market value, providing a strong opportunity for upside potential.”
According to Siegel, Passco is continuing to identify and source value-add opportunities where they can significantly enhance the value of a center by integrating a series of capital improvements and experience-driven amenities.
“As the retail market continues to evolve, we see tremendous opportunity to reposition and bring value to older, well-located centers,” says Siegel. “This acquisition is demonstrative of that fact and will be a strong addition to our existing portfolio.”
Walker, a Managing Director with Cushman & Wakefield, adds, “Temescal Village is an asset that is truly positioned for future upside and growth. It has proven stable cash flow, a diversity of credit worthy tenants, and is located in a market with an established trade area. The region experienced a much quicker recovery post-recession compared to other areas in the Inland Empire, which is indicative of the future economic health of the region, strongly positioning the asset to continue to perform well over the long-term.”
The retail center is currently 93.5 percent leased to a mix of 19 well-known tenants including CVS Pharmacy, Citibank, Carl’s Jr., Wells Fargo, H&R Block, the UPS Store, County of Riverside and Metro PCS, among others.
The architectural firm involved in the renovations for the center is the Architecture Design Collaborative. Chris Black of KeyBank Real Estate Capital’s Commercial Mortgage Group arranged acquisition financing for Passco Companies through Fannie Mae.
About Passco Companies, LLC
Passco Companies, LLC is a nationally recognized market leader in the acquisition, development, and management of multi-family and commercial properties throughout the U.S.
For more than 18 years, Passco has delivered sound investment strategies to clients and partners, enabling them to create, maintain, and add value to their portfolios through a full set of real estate services, asset management, and brokerage, as well as property development, construction, and management services.
Headquartered in Irvine, California, Passco holds a diverse cross section of prime retail, multi-family, office and industrial properties nationwide, and has acquired, managed, and/or developed over $3 billion in property since its inception. The company is currently involved with over 50 properties in 17 states, and is actively growing its investment portfolio in primary and secondary markets throughout the nation. More information is available at www.passco.com.
About Cushman & Wakefield
Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop, and live. Our 45,000 employees in more than 70 countries help occupiers and investors optimize the value of their real estate by combining our global perspective and deep local knowledge with an impressive platform of real estate solutions. Cushman & Wakefield is among the largest commercial real estate services firms with revenue of $6 billion across core services of agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset management (DTZ Investors), project & development services, tenant representation, and valuation & advisory. 2017 marks the 100-year anniversary of the Cushman & Wakefield brand. 100 years of taking our clients’ ideas and putting them into action. To learn more, visit www.cushwakecentennial.com, www.cushmanwakefield.com or follow @CushWake on Twitter.