CT Realty Lands Rare SD Property
CT Realty has purchased a 340k SF industrial building at 12367 Crosthwaite Circle in Poway, CA, from Cohu Inc, in a $34M sale-leaseback deal.
CTR director of acquisitions Steve Provencio tells Bisnow this is a fortuitous acquisition for his company, because large industrial buildings rarely come to market, especially in the Poway submarket. He says the submarket, which is relatively small, is growing in attraction because it’s centrally located with good access going both north and south.
“Large industrial assets available for purchase in the Poway submarket are becoming increasingly rare due to strong market fundamentals and a lack of existing product," he says. “The opportunity to acquire the Crosthwaite property with a long-term Class-A tenant and solid upside potential for the remaining space made this property extremely attractive.”
Steve notes that Cohu, which is a global supplier of testing and inspection equipment used by the semiconductor industry, sold the asset because it plans to expand its product line and wanted to raise capital. The company signed a 10-year lease, with contractual rent increases annually, that provides Cohu the entire building for one year, then nearly 147k SF for the rest of the lease term.
“At the end the first year, we will market the remaining space to outside tenants,” Steve continues, noting that rents currently range from $.80 to $1 NNN in the market.
“Industrial space in San Diego County is in high demand, and it’s virtually impossible to find contiguous blocks of 100k SF or larger—even more so in the Poway submarket,” he said, noting that this submarket only has a total of 9M SF and about 3M SF of that is occupied by General Atomics Aeronautical Systems, one of the nation’s largest defense contractors.
Steve notes Poway is attractive to industrial users because it's centrally located and Highway 56, which stops at Poway’s door front, connects the I-5 and 1I-5 freeways, making it an easy commute for workers living on the coast and those coming from the south. It’s also provides families a good quality of life and has one of the county's better school systems, he says.
Located on a canyon rim, the Crosthwaite property has high visibility. It's one of the largest industrial buildings in the North County region and is a fairly modern facility, with 27-foot height clearance. It features a two-story lobby, a landscaped atrium with common area, outdoor seating and a separate gated parking lot. The site's adjacent to the Sportsplex USA sports and recreation facility and provides easy access to I-15 via Scripps Parkway.
This was CTR’s second major acquisition in Poway over the past 12 months. In January 2015, the company purchased 13550 Stowe Drive, a 112k SF industrial property occupied by General Atomics Aeronautical Systems. With the Crosthwaite acquisition, CTR now owns more than 451k SF of industrial space in Poway.
Louay Alsadek, Brad Black, Hunter Rowe and Andrew Taylor of CBRE San Diego repped Cohu in the deal, and CTR repped itself with advice from Ted Cuthbert of the Carlsbad office of Colliers.