The property is located at 5331 and 5333 Slauson Ave. Arnett says the property benefits from the location, which has “easy access to multiple freeways, the ports, and downtown Los Angeles, and the property has major visibility from the 710 Freeway and Slauson.”

Central Los Angeles is one of the most sought-after industrial markets in the Los Angeles area, and with little developable land and a near 1% vacancy rate, the limited supply has tenants and investors fervently hunting for opportunities. CapRock Partners recently purchased a single-tenant property in Commerce, and it is planning to create value at the property by subdividing the 100% leased, 97,000-square-foot asset to create two industrial facilities on a single parcel.

“This is a great value-add opportunity as the property is a perfect candidate for a subdivision and sale to owner-users,” Taylor Arnett, VP acquisitions for CapRock Partners, tells GlobeSt.com. “Although it is on one parcel, it has two separate addresses and entrances, each with their own private loading and yard space, and it features freeway billboard income, solar panels, and visibility from the 710 Freeway and Slauson which is all attractive to owner-user buyers. The existing lease provides income in the interim, and the term is short enough that we feel confident that we can execute our plan in the near future and take advantage of the strength of the Central L.A. Market.”

CapRock will target owner-users for the property, following the renovation, especially those in need of a manufacturing or distribution facility, the original use of the property. “Central L.A. industrial market is one of the strongest markets in the US, and there is really no more land available for development,” says Arnett. “This market is also unique in that owner-users comprise a significant portion of the ownership of industrial buildings and they are willing to pay a higher price for their real estate than investors. We were able to purchase this property at an investment price and our business plan is to unlock owner user value for a significant profit.” With high demand coming from ecommerce users as well, the property could also be converted easily into warehouse space.

In addition to the tight supply, investment opportunities are also hard to find in this market. CapRock was able to buy this particular asset after it fell out of escrow with another buyer. “The property was in escrow with another buyer who fell out of contract, and through its brokerage relationships, CapRock was notified of the site and we were able to move quickly and tie it up at essentially the same terms as the previous buyer,” explains Arnett. “We have pursued enough deals in Central L.A. to know that we need to move quickly to secure a property that is off-market.” CapRock did not disclose the sales price, but said that it secured the deal well below market value.

The property is located at 5331 and 5333 Slauson Ave. Arnett says the property benefits from the location, which has “easy access to multiple freeways, the ports, and downtown Los Angeles, and the property has major visibility from the 710 Freeway and Slauson.”