Hunter Business Park
Riverside, California in the Inland Empire
One of the current projects that Loewen Capital is working on shows great potential and excitement of a healthy investment. Our newest venture in the works is Hunter Business Park in Riverside, CA. This opportunity is not open for investment at this time, however we wanted to introduce it to potential investors to begin the education process of understanding the positive fundamentals that persist and why we believe this project fulfills the requirements we look for in bringing a new investment opportunity forward.
Industrial & Logistics Real Estate
An extended economic growth cycle and a rise in e-commerce are fueling increased demand for U.S. industrial & logistics real estate, with no near-term end in sight. The continuing growth in e-commerce sales has caused a shift in goods fulfillment. The brick and mortar retail businesses are decreasing while new warehouse development is increasing. This new demand paradigm provides stability and significant growth potential for industrial & logistics real estate.
Despite rising construction costs, the strong demand for warehouses and distribution centers in Los Angeles and the Inland Empire—and corresponding, healthy projected rents—are justifying the additional development of industrial properties in those markets, according to a new report from CBRE.
There is a limited supply of modern logistics facilities that creates a positive demand for new warehouse construction in the Los Angeles and Inland Empire areas. This means that the development market is quite healthy, underwriting remains conservative, projects under development should perform quite well and the incentive is there for continued development.
Further incentive for development in the Inland Empire is the lower cost of construction and land versus Los Angeles. In L.A., average new construction costs for a 500,000-square-foot warehouse approach $170 per square foot, according to CBRE, with land costs alone nearly $100 per square foot. In the Inland Empire, new construction costs hover around $110 per square foot with land costs at roughly $60 per square foot.
Hunter Business Park
Here are some positive highlights of Hunter Business Park that will set the stage for growth, durability and sustainability.
Hunter Business Park is recognized as a well-established, premier business park within the boundaries of the Inland Empire East sub-market. Located 1.5 miles North of the University of California at Riverside, and less than 2 miles from I-215, I-15, Highway 91 and Highway 60, the park is strategically located for a variety of businesses.
Hunter Business Park is home to a variety of large industrial users, including Amazon, Ashley Furniture, FedEx, Home Depot, K&N Engineering, MBM Foods and WalMart.
A significant bonus to being located within the city limits of Riverside is the fact that the Project will be serviced by the consumer-owned Riverside Public Utilities. The cost of electricity is approximately 30% lower than other surrounding Los Angeles based cities that are all serviced by Southern California Edison.
Additional positives regarding this Project are that in June 2016 Metrolink opened a commuter train station ½ mile away from the property. This will allow Hunter Business Park employers to draw employees from a larger footprint in the greater metro Los Angeles area. Secondarily this site is 1 of 3 remaining land parcels available for development of buildings larger than 150,000 SF in Hunter Business Park, further showing the maturity of Hunter Business Park.
We’re looking forward to moving forward on this promising project and bringing you more specific details on what this opportunity may mean to you.
As always, I am available to discuss Loewen Capital interests and answer any questions you may have.