Introduction to the Sale
Brookfield Properties has offloaded part of another shopping mall in California. The Toronto-based investment management firm sold The Shoppes at Carlsbad in a $71.5 million transaction, Commercial Observer reported. A joint venture between Los Angeles-based Steerpoint Capital and San Mateo-based Steelwave bought the 727,000-square-foot main portion of the property.
The mall at 2525 El Camino Real spans a total 1.1 million square feet. The purchase doesn’t include the mall’s anchor tenants such as Macy’s and JCPenney. The shopping center currently has an occupancy rate of 74 percent, according to CO.
Details of the Transaction
Brookfield acquired the property in 2015 for $170 million. The firm completed renovations at the site two years later. At the $71.5 million price point, or $98 per square foot, Steerpoint and Steelwave picked up the property for a bargain. Archway Capital provided the buyers with a $42.9 million acquisition loan, according to CO. Of that, $4 million is set aside for capital improvements such as entrance upgrades, new common area seating and renovated restrooms. It marks Archway’s largest loan transaction to date, per CO.
Strategic Acquisition
“This acquisition highlights our strategy of securing high-quality assets at a low basis in markets with undeniable strength,” Jack Steger, director of investment and development at Steerpoint, said in a statement, per CO. Other Southern California malls that have sold recently were transactions with notably higher prices per square foot. Last month, a joint venture between Silverpeak, Pacific Retail Capital Partners and Lyon Living paid $332.1 million, or $158 per square foot, for Macerich’s Lakewood Center in Lakewood. Last year, Stockdale Capital Partners spent $157 million, or $130 per square foot, for The Oaks in Thousand Oaks. A joint venture between RCB Equities and Real Estate Development Associates dropped $156 million, or approximately $142 per square foot, for Puente Hills Mall in the City of Industry.
Recent Activities of Brookfield
Brookfield was also the owner of the beleaguered San Francisco Centre mall. It abandoned its ownership post after stopping payments on a loan for the 1.5 million-square-foot property. That mall now sits at 93 percent vacancy, the San Francisco Chronicle reported.
Related News
For more information on similar transactions, you can read the following articles:
Westfield and Brookfield to surrender San Francisco Centre mall
Stockdale ID’d as buyer of The Oaks mall from Macerich for $157M
How low can San Francisco Centre mall go?
Conclusion
The sale of The Shoppes at Carlsbad to Steerpoint Capital and Steelwave for $71.5 million marks a significant transaction in the Southern California retail market. The joint venture’s acquisition of the property at a relatively low price point highlights the opportunities available for investors in the current market. As the retail landscape continues to evolve, it will be interesting to see how this property and others like it are repositioned and redeveloped to meet changing consumer demands.
FAQs
Q: Who bought The Shoppes at Carlsbad?
A: A joint venture between Los Angeles-based Steerpoint Capital and San Mateo-based Steelwave bought the 727,000-square-foot main portion of the property.
Q: How much was The Shoppes at Carlsbad sold for?
A: The property was sold for $71.5 million.
Q: What is the occupancy rate of The Shoppes at Carlsbad?
A: The shopping center currently has an occupancy rate of 74 percent.
Q: How does the price per square foot of The Shoppes at Carlsbad compare to other recent mall sales in Southern California?
A: The price per square foot of The Shoppes at Carlsbad is lower than other recent mall sales in Southern California, which have ranged from $130 to $158 per square foot.
