Carlsbad CA— CBRE announced that San Diego-based real estate developer Pacific Realty Advisors sold a flex industrial property in Carlsbad, Calif. to a private 1031 investor for $9.17 million.
Located 2251 Rutherford Road, the 34,304 square-foot, freestanding building has recently been renovated and transformed into a creative flex industrial space. The property features a new glass line, fitness center, outdoor meeting areas, drought tolerant landscaping and multiple grade level doors. The building was 100 percent leased at the time of sale to Denso, a leading supplier in the automotive industry and Aesthetic Revolution, a high-end training apparel company.
The building is adjacent to the McLellan-Palomar Airport, the fourth-busiest single runway airport in the United States. The property sits three miles west of I-5, a major Southern California freeway that connects Carlsbad to the rest of San Diego, as well as Orange County. Carlsbad is home to a wide range of business clusters including life sciences, action sports, clean technology, information and communications technology (ICT), and hospitality and leisure.
“Carlsbad has been the hottest flex industrial submarket in San Diego County over the past two years, posting over one million square-feet of positive absorption since the beginning of 2017,” said Pourcho. “Industrial buildings of this size are in extremely high demand, particularly in Carlsbad, where the vacancy rate is currently 1.7 percent for this product type and its size range. The desirability of this type of asset, coupled with the recent renovations to the property, allowed us to secure a high sales price that ended up being above our original asking price.”
The repositioning of the property was led by Jeremy Dentt and Ryan Dentt of Pacific Realty Advisors.
Overall asking rates for industrial/R&D product are up by 25 percent over the past five years, with high-finish product responsible for the largest increase at 30 percent, according to a CBRE research report. North County San Diego continues to outpace the rest of San Diego, made evident by approximately two million square-feet of net absorption over the past two years and nine of the last 10 quarters delivering positive net absorption
The CBRE team also represented the buyer in the transaction.