1031 Exchange of Four Southern California Properties Totaling $26.9 Million
Temecula, CA – Avison Young, announced today that it has negotiated a strategic 1031 exchange of four properties with a total transaction value of $26.9 million.
The complex process involved the sale of a three-property, multi-family/mobile-home portfolio that included 66 apartment units and 171 mobile-home spaces in various Southern California locations, and then the trade into Madison Avenue Plaza, a 70,749-square-foot (sf) office property in Temecula, CA.
Avison Young Principal Peter Hauser and Matt Hauser and Masa Ito, Associates in the company’s Irvine, CA office, represented the seller of the portfolio, a San Diego-based private investor.
Matt Shaw, a Vice-President in Avison Young’s Ontario, CA office; Corey Martin, Avison Young Principal and Managing Director of the company’s Austin, TX office, who is also a licensed broker in California; and Avison Young Principal Stan Nowak, who is also based in the firm’s Ontario, CA office, represented the seller of Madison Plaza, an affiliate of Providence Capital Group Inc., which is based in Encinitas, CA, as well as the buyer in the upleg of the 1031 exchange.
“The private-investor client had identified Madison Avenue Plaza as a desired upleg and was looking to sell its management-intensive multi-family assets and trade into a single, stabilized investment property,” says Peter Hauser. “Our multi-family team was able to seamlessly execute the underwriting, marketing and sale of the three portfolio assets and secure top-of-market pricing. During the complex process, the multi-family and office teams communicated constantly with all parties in both the downleg and upleg transactions to ensure expectations and deadlines were met. Ultimately. we successfully closed all transactions within the tight time frame required by 1031 exchange laws, and exceeded our client’s expectations and long-term investment goals.”
The Avison Young platform is a shared marketing system that allows for the free flow of information between company advisors. This complex transaction is a prime example of the firm’s ability to work together as a team to successfully execute on the client’s business plan.
The three-property multi-family/mobile-home park portfolio was sold for a total of $11.8 million to three separate private buyers.
The portfolio properties in the sale included:
- Wagner Mobile Home and RV Park, a well-maintained 171-space senior community situated on nearly 24 acres at 18801 Roberts Road in Desert Hot Springs, CA
- Aurora Apartments, a 49-unit apartment community located at 480 Aurora Drive in El Centro, CA
- Brawley Apartments, a 17-unit apartment community located at 231 Canal Road in Brawley, CA
The upleg in the 1031 exchange was Madison Avenue Plaza which sold for $15.1 million. Built in 2003, Madison Avenue Plaza is located at 27270 and 27290 Madison Avenue in Temecula, with additional parking located at 41427 Sanborn Avenue. The two-building, three-story property is situated on 4.81 acres adjacent to, and highly visible from, Interstate 15, and is approximately 98% occupied by seven tenants. The 27270 Madison building is fully occupied by San Joaquin Valley College, while the 27290 Madison building includes a majority of financial and medical-oriented tenants.
“We were pleased to be able to work with Peter Hauser and the buyer on this 1031 acquisition of Madison Avenue Plaza,” says Shaw. “This high-quality office asset offered an investor a property with strong occupancy and cash flow. Additionally, its prominent location in Temecula – an affluent Riverside County location that continues to see job and population growth – provides a generational type of asset that is anticipated to appreciate in value as rents continue to rise due to thriving tenant demand.”
Madison Avenue Plaza provides easy access to the 15 and 215 freeways as well as proximity to walkable amenities, including Starbucks, Subway, Filpipi’s Pizza Grotto, Annie’s Diner, and California Bank and Trust, among others. It is also situated less than two miles from Old Town Temecula and its community events, shopping and high-end restaurants, and is approximately one mile from the Promenade Mall, a regional mall spanning more than 2.2 million square feet of retail locations and restaurants.
Avison Young is the world’s fastest-growing commercial real estate services firm. Headquartered in Toronto, Canada, Avison Young is a collaborative, global firm owned and operated by its Principals. Founded in 1978, with legacies dating back more than 200 years, the company comprises approximately 5,000 real estate professionals in 120 offices in 20 countries. The firm’s experts provide value-added, client-centric investment sales, leasing, advisory, management and financing services to clients across the office, retail, industrial, multi-family and hospitality sectors.