Hanley Closes Inland Empire Retail 1031 Exchange

By Ariela Moraru

78-825 Highway 111, La Quinta, Calif.

Hanley Investment Group Real Estate Advisors completed the sale of a retail building occupied by T.J. Maxx and ULTA Beauty in La Quinta, Calif. Part of Washington Park Shopping Center, the 33,708-square-foot pad building traded in an all-cash 1031 exchange for around $8.9 million.

Executive Vice President Bill Asher and President Ed Hanley represented the seller, a Southern California-based private partnership. Steven Gelber of Gelber Realty Corp. represented the buyer, a Los Angeles private investor who owned similar assets.

Located at 78-825 Highway 111, the building is situated on 3.6 acres and was remodeled in 2016. The asset’s visibility was enhanced by the demolition of an older multi-tenant strip center and the redevelopment of a new ALDI and In-N-Out at the corner of Highway 111 and Simon Drive. Other tenants of the shopping center include Target, Lowe’s, Trader Joe’s, ALDI, Stein-Mart, Chase Bank and Century Theaters. The property is located in an area with an average household income of more than $99,000, making it one of the highest income cities in the Coachella Valley and contributing to its attractiveness for corporate retailers.

Strong tenant base

Both T.J. Maxx and ULTA Beauty are bound by new corporate-backed long-term leases.

“T.J. Maxx is S&P rated ‘A+ Stable’ and has the largest market cap of all apparel companies ($52 billion) and consistent annual revenue growth of over 7 percent year-over-year. ULTA Beauty has achieved seven straight quarters of consecutive revenue growth and a 77 percent gain in their stock price over the last 12 months,” said Asher in prepared remarks.

Image courtesy of Hanley Investment Group