Grocery-Anchored Neighborhood Center Largest Sale Since Recession
Burbank Property Continues the Momentum in the Retail Sector
Colliers International has completed negotiations on the sale of Gateway at Burbank, a 74,391-square-foot, two-building grocery-anchored shopping center in Burbank, Calif. A fund advised by CBRE Global Investors acquired the asset for an undisclosed record price.
Although the unidentified seller would not publicly disclose the sales price, the transaction allegedly represents the largest sale of a Class A grocery-anchored neighborhood shopping center in greater Los Angeles since 2007, a year before The Great Recession, according to industry sources.
Gateway at Burbank is located at 25-113 E. Alameda Street near the center of Burbank’s well-trafficked retail core. The center is comprised of a free-standing Ralphs Grocery Store and a multi-tenant and fully occupied building anchored by a major chain drug store. It totals 74,391 square feet of retail space with ample parking.
“This is the largest acquisition of a true grocery-anchored neighborhood shopping center in the Los Angeles area since before the recession,” said Colliers Associate Vice President El Warner who, along with Executive Vice Presidents Tom Lagos and Jereme Snyder, represented the unidentified seller. “It illustrates that core grocery- anchored shopping center owners are taking notice of the significant demand and severe lack of supply this product type represents in the market. With this part of Burbank awash with new and expanding retailers, this was a sound investment for the buyer.”
According to Warner, the physical location of the center was another strong selling point. Not only is it adjacent to the largest IKEA store now under construction in the United States, but it also features high-profile exposure along the Golden State Freeway (I-5) and direct frontage along San Fernando Boulevard and East Alameda Street, two of the area’s main arterial highways. The center also benefits from a corner location and a signalized entrance.
“Tenant space demand for Los Angeles retail is strong and is expected to continue,” said CBRE Global Investors Managing Partner Kim Hourihan. ”With easy access to major transportation corridors, executive housing and numerous destination retail amenities, our acquisition of this dominant grocery- and drugstore-anchored center with proven sales history represents the blend of a strong neighborhood center in an urban location.”
Recent census studies have put the number of households within a three-mile radius of the center at 66,127 with steadily rising traffic counts. Retailers like the new IKEA store and other national chain retailers that are located in the immediate area of the center are expected to drive traffic counts even higher.
“There was no lack of potential buyers as we were marketing the property,” added Lagos. “It was only a matter of which investment group could meet the seller’s requirements in the most efficient manner possible.”