PASADENA, CA—Two mixed-use retail properties in the South Lake Avenue retail district of Pasadena have traded hands for a total of $20.5 million.

San Diego-based Paragon Real Estate Fund purchased the 20,435-square-foot, ground floor space at Retail @ Pasadena Collection for $10.8 million, the larger of the two transactions. "This is a trophy location with excellent demographics. The intersection of South Lake Avenue and Cordova Street is in the heart of the South Lake Avenue retail and office district, which has extremely low vacancy," says Carlos J. Lopez, Hanley Investment Urban Retail Advisors president, who represented the buyer and seller, a private investor, in this transaction along with his Hanley Investment Urban Retail Advisors colleague senior associate Lee T. Csenar.

The retail space sits below 110 luxury residential units, and the property is located one block from the Corporate Center Pasadena. Several tenants, including Vitamin Shoppe, T-Mobile, Sharky's Woodfired Mexican Grill and several other restaurants currently occupy the property. "This investment offers Paragon an upside potential and an opportunity to obtain market rate lease rates," Lopez says. “100% of the occupied square footage has renewed or extended their leases since 2010, confirming market rents and the demand for retail space at the Pasadena Collection."

A Los Angeles credit union purchased the two-story, 29,334-square-foot Arbour Building for $9.8 million from a private, local investor. The purchase included a 27,802-square-foot parking lot with 74 parking spaces. "The Arbour Building is located in one of the premier shopping corridors in the region and offered a tremendous upside with 54% vacancy, as well as the ability for the purchaser to occupy a portion of the building," says Lopez, who represented the seller along with Pat S. Hurst of Hurst | Harrigan Associates. Corey A. Waite of Colliers International represented the buyer.

This area of Pasadena is highly desirable for retail tenants. "Within a 3-mile radius of both Retail @ Pasadena Collection and the Arbour Building, the average household income is approximately $96,000,” Lopez explains. The high-income demographic attracts investors of all property types. Last month, GlobeSt.com reported that the Sheraton Hotel in Pasadena traded hands. Urban Commons and Brighton Management purchased the 333-room hotel for an undisclosed amount.