Southland Industries Adds in Garden Grove

Real Estate: Contractor takes Money Mailer’s old headquarters
By Mark Mueller | October 16, 2017

Southland Industries, one of the country’s largest mechanical, electrical, and plumbing systems contractors, is stepping up its presence in its home of Garden Grove.

The privately held company, which has a long history in Orange County, signed a lease this month to occupy all of a recently upgraded, 207,953square-foot industrial and office building at 12131 Western Ave.

It’s one of the largest leases in North OC this year, and takes one of the biggest empty buildings in the region off the market.

The 9.6-acre property is a few blocks north of the Garden Grove (22) Freeway near the intersection of Western and Chapman avenues. It previously held the headquarters of Money Mailer LLC, which vacated it a few years ago after downsizing operations.

The building’s current owner, Rexford Industrial Realty Inc. in Los Angeles, has overseen a large renovation of the site since buying it last year from Newport Beach based CT Realty Investors as part of a larger portfolio deal.

Upgrades include creative-office flourishes to the nearly 50,000 square feet of office space, plus a new facade and an enlarged parking lot.

Southland Industries is scheduled to move into the building around December under a 10-year lease, according to Clyde Stauff, senior executive vice president for the Irvine office of Colliers International.

Stauff represented Rexford in the lease along with Colliers Executive Vice President Michael Hartel and Voit Real Estate Senior Vice President Mike Bouma.

Keeping the company in the city is “a big win for Orange County,” Stauff said.

Mike Wiley, corporate managing director at the Newport Beach office of tenant brokerage Savills Studley, represented Southland Industries in the lease.

The property was being marketed for 76 cents per square foot, per month, according to Voit’s marketing material.

Tofu Takeover
The new lease is a step up in space for Southland Industries, whose current local offices in Garden Grove, about a mile from the Western Avenue property, total about 120,000 square feet.

The company provides mechanical engineering and other services for large construction projects, hospitals and universities being among other clients. It employs about 500 people in OC and did nearly $400 million in sales here last year, per Business Journal data, No. 47 on the largest private companies list.

Notable projects it’s working on include the new soccer stadium for the Los Angeles Football Club in downtown Los Angeles, according to Southern California Division Leader Payman Farrokhyar.

The Western Avenue facility, featuring new equipment, will offer the company a “forward-looking” space for its design-build facilities, with plenty of room for interdepartmental collaboration, and allow for more growth, Farrokhyar said.

“We’ve been aggressively hiring” recently to support the company’s Southern California operations, he said. “This market has been doing really well.”

The company’s also nearing a lease for a new retail location in downtown L.A.

The Business Journal reported in August that House Foods America Corp., a Garden Grove-based manufacturer of tofu, noodles and other Asian-influenced food products, bought a building in the city that Southland Industries had occupied, an 83,000-squarefoot office at 7421 Orangewood Ave.

House Foods paid about $17.5 million for the property, which sits next to its headquarters and local tofu manufacturing facilities, with plans to expand area operations.
Southland had leased the building on Orangewood, but it owns another, smaller office nearby at 7390 Lincoln Way.

The company lists its headquarters as being at the Lincoln Way building, and it has much of its corporate operations in Garden Grove, although some of its executive team is based in the Washington, D.C., suburbs.

It moved its Southern California operations and headquarters from Irvine in 2012.

The Western Avenue facility will be the Southern California division of Southland, while corporate offices will remain at the Lincoln Way building, according to Savills Studley’s Wiley.

The company had been looking at facilities outside of the area for a potential move, including sites in the Inland Empire, before inking a deal to stay in Garden Grove, he said.

“Their preference had been to stay in North Orange County.”

Rexford Industrial Announces Completion Of 317,000 SF Of Value-Add Repositioning And Lease-Up Plus 40,473 SF Of Acquisitions

LOS ANGELES, Oct. 12, 2017 /PRNewswire/ — Rexford Industrial Realty, Inc. (the “Company” or “Rexford Industrial”) (NYSE: REXR), a real estate investment trust focused on owning and operating industrial properties located in Southern California infill markets, today announced the completion of value-add repositioning and lease-up at two properties, 3880 W. Valley Boulevard and 12131 Western Avenue. Additionally, the Company acquired two industrial properties for $7.4 million. The acquisitions were funded using cash on hand.

“We are pleased to announce the lease-up and completion of value add repositioning of approximately 317,000 square feet, as we continue to leverage Rexford’s ability to create value through repositioning as we capitalize on the unique supply-demand dynamics of the infill Southern California industrial market,” stated Howard Schwimmer and Michael Frankel, Co-Chief Executive Officers of the Company. “These two projects achieved attractive, above-market stabilized yields and are a testament to the quality and hard work of the Rexford team. In addition, Rexford recently closed $7.4 million of incremental acquisition activity, which brought our year-to-date total investments to over $534 million. We continue to see favorable opportunities to execute our internal and external growth strategies to drive cash flow and shareholder value.”

The Company recently completed repositioning and lease-up of 3880 W. Valley Boulevard, located in Pomona in the San Gabriel Valley submarket, a single-tenant 108,500 square foot free-standing building with excess land for container storage. After the previous tenant vacated, Rexford completed extensive renovations including a new building façade, renovation of office areas, 19 new dock-high loading positions and ESFR fire sprinklers. In August 2017, the Company signed a five-year triple net lease to a luxury high-end car company which commenced in September 2017. Rexford achieved a 6.9% unlevered cash yield on total investment based upon the income from the initial year of the lease, which also comprises annual rental rate increases throughout the term of the lease. The tenant was represented by Douglas Sharpe with NAI Capital, and Rexford was represented by Robin Dodson, Erik Larson, and Christopher Tolles with Cushman & Wakefield.

Additionally, Rexford completed repositioning and lease-up of 12131 Western Avenue in Garden Grove in the Orange County submarket, a single-tenant free standing cross-dock building containing 207,953 square feet. After the previous tenant vacated, Rexford completed a full building renovation including a new two-story lobby, modernization of office areas and new ESFR fire sprinklers. In October, the Company signed a 10-year triple net lease with Southland Industries, a national engineering firm, which is expected to commence at year end. Rexford achieved a 5.9% unlevered cash yield on total investment based upon the income from the initial year of the lease, which comprises 3% annual rental rate increases through the term of the lease. The tenant was represented by Matt Wiley of Savills Studley, and Rexford was represented by Clyde Stauff and Michael Hartel with Colliers and Mike Bouma with Voit Real Estate Services.

In September, in an off-market transaction, the Company acquired 1825 S. Soto Street, located in the Los Angeles – Central submarket for $3.5 million, or approximately $139 per square foot. The property consists of 25,040 square feet on 1.03 acres and is fully leased at substantially below market rates to a publicly traded company. The building has 26′ clear heights and a secured yard. According to CBRE, the vacancy rate in the 286 million square foot Central Los Angeles submarket was 1.6% at the end of the third quarter 2017.

In September, Rexford also acquired 19402 S. Susana Road in Rancho Dominguez, located in the Los Angeles – South Bay submarket for $3.9 million, or approximately $255 per square foot. The 15,433 square foot industrial building is situated with excess paved land on 1.69 acres and is fully leased to one tenant. According to CBRE, the vacancy rate in the 221 million square foot South Bay submarket was 0.8% at the end of the third quarter 2017.

About Rexford Industrial
Rexford Industrial is a real estate investment trust focused on owning and operating industrial properties in Southern California infill markets. The Company owns 146 properties with approximately 18.0 million rentable square feet and manages an additional 19 properties with approximately 1.2 million rentable square feet.

For additional information, visit www.rexfordindustrial.com.

Contact:
Investor Relations:
Stephen Swett
424 256 2153 ext. 401
investorrelations@rexfordindustrial.com

SOURCE Rexford Industrial Realty, Inc.

Related Links

https://www.rexfordindustrial.com

 

VOIT REAL ESTATE SERVICES DIRECTS THE $7,125,000 SALE OF A 40,840 SQUARE-FOOT INDUSTRIAL PROPERTY IN GARDEN GROVE

Garden Grove, CA., (September 14, 2017) – Mike Bouma, Senior Vice President, and Eric Smith, Senior Associate, of Voit Real Estate Services’ Anaheim office successfully directed the $7,125,000 million sale of a 40,840 square-foot industrial facility in Garden Grove, on behalf of the seller, The Realty Associates Fund X, L.P., based out of Boston, MA. The buyer, Exelon Realty LLC, a privately owned real estate company based out of Encino, CA, was also represented by Mike Bouma and Eric Smith of Voit Real Estate Services.

“Strong market fundamentals in the Orange County Industrial market, a credit tenant, an excellent Garden Grove location and a long tenancy of similar uses made this property very attractive,” according to Bouma.

The property is located at 7142 Chapman Avenue and 12031/51 Industry Street in Garden Grove.

About Voit Real Estate Services

Voit Real Estate Services is a privately held, broker owned Southern California commercial real estate firm that provides strategic property solutions tailored to clients’ needs.  Throughout its 45+ year history, the firm has developed, managed and acquired more than 64 million square feet, managed $1.4 billion in construction projects and completed in excess of $46.5 billion in brokerage transactions encompassing more than 44,500 brokerage deals.  Voit’s unmatched expertise in Southern California brokerage, investment advisory, financial analysis, and market research enable the firm to provide clients with forward looking strategies that create value for a wide range of assets and portfolios. Further information is available at www.voitco.com.