Continental Realty Makes SoCal Retail Debut

South Coast Collection previously traded for $120 million in 2015. Image courtesy of Continental Realty Corp.

Continental Realty Corp. has entered the Southern California market with the acquisition of the South Coast Collection, a 292,000-square-foot luxury lifestyle center in Costa Mesa, Calif. The buyer used funds from Continental Realty Opportunistic Retail Fund I LP, a closed-end fund for which $261 million have been raised since 2021.

The previous owner was Rockwood Capital, according to CommercialEdge data, which had paid $120 million for the property in 2015.

The current sale price was not disclosed, but online information indicates that the transaction was valued at more than $100 million, reportedly making it one of the largest single-asset acquisitions this year. Christopher Hoffman and Mark Damiani of Eastdil Secured represented the seller.

SoCo was the second asset acquired by CRC on behalf of CRORF this year; the first was a nearly 460,000-square-foot super-regional lifestyle center just east of Tampa, Fla. CRC has now acquired nearly $720 million worth of retail real estate since the beginning of 2020.

An Orange County retail center

SoCo came online in 2007 at 3303-3323 Hyland Ave. The 20-acre site has 1,000 feet of frontage on the San Diego Freeway. The property was 97 percent leased at the time of sale to a mix of design, home furnishings, fashion, culinary and other specialty retailers, along with more than 20 food offerings.

COCO Republic, Design Within Reach, Roche Bobois, Pirch and Paul Mitchell the School anchor the retail center; additional retailers include Brown Jordan, Natuzzi Italia, and Room & Board. Restaurants and food outlets feature Arc Food and Libations, Butcher’s House, Greenleaf Kitchen & Cocktails, Moulin, Paragon and Portola Coffee.

Also on the property is The OC Mix, a 15,000-square-foot shopping and dining experience with more than 20 full-service sit-down restaurants, coffee shops, quick-service restaurants, a fine cheese retailer and an art gallery.

The Orange County retail market saw above-average rent growth in the third quarter of this year, driven by limited available space and robust demand. According to a recent Matthews report, rents have risen by an average of 2.6 percent on a year-over-year basis. At the same time, very little new supply will enter the county’s inventory over the next months, as only 130,000 square feet of retail space was under construction in Q3.