South Bay Mall Goes for $50m
The South Bay Pavilion, a 1.1 million-square-foot shopping center in Carson, Calif., has been sold to veteran real estate executive Fred Sands for a reported $50 million.
Sands purchased the center, formerly known as the Carson Mall and located at Interstate 405 and Avalon Boulevard, through his Los Angeles–based Vintage Real Estate LLC, a turnaround specialist that buys underperforming properties generally at below-market value.
The partnership of Hopkins Real Estate Group/Genesis paid $34.4 million for the property in 2003 and invested an additional $30 million in a renovation, which was completed in 2007. It put the property on the block in 2005 but was unsuccessful at getting its $100 million asking price.
Ikea, Target, Sears and JCPenney anchor the center. Old Navy, Children’s Place and Foot Action are among its 54 tenants.
Now Sands will invest in more improvements, such as a stadium-seating movie theater and more specialty retail space. The mall has about 35,000 square feet of vacant space.
“With 73 acres of land, we have room to expand,” Sands said. “Our team is currently negotiating with seven national restaurant chains, and we intend to add at least three freestanding restaurants.”
Added Brenton Watson, president of Vintage: “This is a very significant acquisition, particularly in light of the difficulty of obtaining financing on regional malls today. Not only are the capital markets frozen, but some people are worried about how retail sales will hold up during the recession. However, some very smart and sophisticated investors are bullish on retail.”
Sands said more than 350,000 cars drive by the mall daily. The area has about 150,000 workers in the immediate vicinity. Carson is home to several oil companies—including BP, Shell and Mobil—as well as other Fortune 500 companies, including Toyota, Honeywell, Honda and Mercedes-Benz.
Vintage Capital also owns malls in Laguna Hills and Santa Clarita, Calif.;Washington state; New Mexico; and Ohio. —Robert McAllister
