Metro Volume and Pricing
Los Angeles County single property retail investment posted the strongest dollar total in years, with Reis Transaction Analytics recording 42 deals for $556 million in the second quarter of 2012.* The mean price for second quarter was $235 psf, roughly in keeping with the quarterly values of the previous few years. The largest deal of the quarter was the sale of the 807,600-square-foot Westfield Eastland in West Covina, which sold for $147 million ($182 psf). Westfield sold it to Cole Real Estate Investments in May. .
The Westside/Downtown submarket continues to lead Los Angeles submarkets in dollar volume sold over the past 12 months at $455 million, as well as in square footage sold, at 1 million. The San Gabriel Valley East recorded 996,402 square feet sold for a transaction volume of $183 million, raking it second by both measures. At $443 psf, the West Side/Downtown led in price per square foot, followed by South Bay/Torrance at $278 psf.
Cap Rate Comparison and Forecasts
The mean cap rate for Los Angeles retail transactions is 6.7%, a low rate for recent years. The rolling 12 month cap rate, which has been falling here since early 2010, decreased 50 basis points to 6.9%. Reis predicts gradual increases in the 12 month mean, eventually reaching 7.4% by 2014.