This ground up development project is an approximately 15,000 square foot retail development on a major signalized intersection in the city of Norwalk. It was acquired in March 2014 and has close proximity to the I-605, I-105 and I-5 freeways. At the time of acquisition it consisted of a 4,387 square foot vacant Norm’s restaurant on a 69,260 square foot parcel of land. Demolition was completed during the design and entitlement process. Preliminary plans were to construct three pads of various sizes, to provide all tenants with maximum exposure. These plans were well received within the marketplace, as the project was 100% pre-leased prior to the commencement of construction. We have executed three leases, two of which are ground leases with national credit tenants. As a result of negotiating two long term ground leases, we were not only able to reduce the equity needed to complete this development, but were able to sell it at a lower cap rate.
This property sold on August 8, 2017 for $8,675,000, at a 4.6% cap rate. The total profit to our investors was $2,273,500.
