Q2 2012 Los Angeles, California Retail Property Sales Analysis

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Q2 2012 Los Angeles, California Retail Property Sales Analysis

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. .

Top Submarkets

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.