Los Angeles-Area Retail Asset Trades in 1031 Exchange

Griffin Plaza. Image courtesy of JLL Capital Markets

Griffin Living has sold Griffin Plaza, an 85,022-square-foot, grocery- and pharmacy-anchored retail center in the Los Angeles suburb of Simi Valley, Calif. JLL Capital Markets brokered the $22.1 million transaction on behalf of the seller. A private investor acquired the asset through a 1031 exchange.

Built in 1981 and renovated in 2019, the 94 percent leased shopping center is anchored by an Aldi supermarket and a CVS Pharmacy, which represent 55 percent of the property’s gross leasable area. Wendy’s and a recently developed 102-unit Varenita Assisted Living Community are among the other tenants at the property.

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Situated at 3885-3977 Cochran St., Griffin Plaza provides connectivity to Cochran Street and Tapo Canyon Road, a major thoroughfare in the city. The property is exposed to a daily traffic of 53,800 vehicles, serving a population of 118,769 residents within a 5-mile radius. Simi Valley’s downtown area is less than 5 miles from the asset.

JLL Capital Markets Managing Directors Gleb Lvovich and Geoff Tranchina, along with Senior Director Daniel Tyner, acted on behalf of the seller.

Dynamic 1031 exchange transaction activity in California

In a prepared statement, Tyner said that the Griffin Plaza sale is an example of the dynamic 1031 exchange sales activity in the region’s retail sector. Lvovich added that assets with grocery and pharmacy anchors in prime locations continue to see strong demand due to their long-term potential for rent growth.

Earlier this month, Lvovich was involved in another 1031 exchange sale in Menifee, Calif. A private investor acquired Center Pointe, a 41,461-square-foot, grocery-anchored retail center, for $24.6 million.

A recent Cushman & Wakefield report showed that the retail real estate market remained robust in the fourth quarter of 2022, with strong demand reducing shopping center vacancy to historic lows. As of the end of last year, nationwide vacancy clocked in at 5.7 percent. The same source reveals that net absorption increased to 10.9 million square feet in the fourth quarter of last year, surpassing the 9.4 million-square-foot average of the previous two quarters. In Los Angeles, net absorption totaled almost 73,000 square feet in the last quarter of 2022, while vacancy stood at 5.7 percent.