Southern California Industrial Real Estate Blog

Two Warehouse Leases Fill 314,000 SF

SANTA FE SPRINGS, CA-Logistics firm Kintetsu International has taken nearly 172,000 sf of A&E Plastics space at Golden Springs Business Park, and outdoor furniture maker Janus et Cie Inc. has leased 142,000 sf in a nearby building in this city as the Mid-Cities market continues as a top performer among Los Angeles County’s industrial submarkets.

Kintetsu signed for its space in a sublease with A&E Plastics, with Henry Johnson, Mike Foley and Dave Hess of Trammell Crow Co. representing A&E Plastics and Kintetsu represented by CB Richard Ellis. Janus et Cie Inc.’s space is at building owned by Accuride International at 12310 Greenstone Ave. Accuride was represented by Foley and Hess, with Janus et Cie represented by Colliers International in the $5-million deal.

The two leases follow a recent industrial sale in which Cornerstone Real Estate Fund, a private REIT, acquired a 105,005-sf multi-tenant industrial park at 14912-14948 Shoemaker in Santa Fe Springs for $12.4 million, according to Voit Commercial Brokerage. Cornerstone bought the property from First Industrial Realty Trust in a transaction brokered by Mike Hefner and Mike Cargile of the Irvine office of Voit, who represented both sides in the deal.

The Mid-Cities market, also known as the Mid-Counties market because it straddles Los Angeles and Orange counties, has perennially posted some of the lowest vacancy rates in the region. Recent market reports peg the overall availability, including both direct and sublease space, at about 5%. One report, from CB Richard Ellis, credited the Mid-Counties market with “the most significant annual change” of any industrial submarket in the county, a 30% decrease from 7.2% in the second quarter of 2005 to 5% in the second quarter of this year.

By Bob Howard of GlobeSt.com

CALIFORNIA LEADS THE NATION IN EXPORTS

CALIFORNIA LEADS THE NATION IN EXPORTS

California topped the nation in July with $10.7 billion in exports and $75.2 billion in year-to-date exports through July. Texas was second, with $10.0 billion and $66.9 billion respectively. New York was a distant third place with $4.4 billion in July exports and $34.1 billion in year-to-date exports for 2006.

Information Courtesy of The Economic Data Global Express.

Is your property ready for the rain?

 Is your property ready for the rain? Autumn is upon us and as you might expect, we will soon have our first good rain. As all property owners are fully aware, it’s time to implement the annual preventative maintenance measures to best prepare your property for the rainy season.

THE ROOF

Roofing should be inspected for damaged, loose or missing shingles, or open seams. If your property has tenants, don’t be surprised to find strange items such as mattresses, barbecues, tables, etc. on the roof. Clear off the junk. Accumulated debris inhibits water from flowing off the roof to the ground. It can cause pooling, which leads to leaks, or can redirect the flow of water to unintended areas which may be vulnerable to water intrusion. Special attention should be paid to high-wear areas where there is significant foot traffic. Flashings at dormers, plumbing stacks, valleys and air conditioning units should be carefully inspected. Years of sun can cause the seals of vent pipes to become brittle and crack. A little sealer applied before the rains can prevent damage to ceilings and walls from water intrusion. Supports for television antennas or satellite dishes should be checked. Electric cables should be well secured and properly powered. Leaves and debris should be cleared, as well as to minimize trapped moisture. Tree branches should be kept cut back to avoid damaging the roof surface. Insects, especially carpenter ants, use limbs as bridges to enter your home.

GUTTERS AND DOWNSPOUTS

Clean your gutters and downspouts. Overflow due to build-up of leaves and debris in gutters is the leading cause of rotting trim boards at the edge of the roof. Clogged gutters are mosquito-breeding sites, clearing them of leaves will reduce the risk of bites and weird diseases. Excess water against the foundation wall can weaken the footing and lead to cracks. Avoid these ugly issues. Gutters and downspouts should be checked for blockage, leakage and areas requiring resecuring or re-sloping.Make sure that downspouts discharge onto splash blocks or pipes that are directed well away from the building to avoid foundation problems. Keep your foundation dry. Bugs love moisture. Keeping the soil dry around the foundation perimeter can force bugs to go elsewhere to snack on a dampened two-by-fours. “What’s required to maintain a building will vary from one property to the next. But, generally, roofs need to be kept free of debris,” notes real estate author Dian Hymer. “Broken tiles, shakes or shingles need to be replaced. Vent pipes and chimneys need to be properly sealed. Drainage systems require periodic upkeep. This starts with the gutters and downspouts, which should be cleaned and flushed.”

LEAKS

Even with good property maintenance, it’s easy to get a leak. For the better part of the year, the blistering Southern California sun has been beating down on our roofs, drying out caulking, cracking paint and causing most roofing materials to degrade.A poorly vented attic can easily reach 150 degrees. Not only is it uncomfortable, it takes its toll on exterior surfaces. “While many leaks are easy to repair, they can be difficult to locate. Water can leak through the surface in one place and finally come into the attic several feet away, then run farther down the rafters before finally causing a stain on the ceiling,” observes Garet Denise or Cornerstone Inspection. “The most common causes of leaks are deteriorated, missing or broken shingles, and improper flashing around penetrations such as plumbing stacks, skylights or chimneys.” A visit to the attic or crawl space below the roof can show early signs of a leaking roof. Indicators include staining or discoloration on framing and the underside of the roof sheathing, and insulation, not to mention crumbling mortar around chimneys. Pay close attention to any penetration areas like plumbing stacks, skylights and chimneys. Also look where the roof surface meets an adjacent wall. If the roof is under warranty, be sure to have the roofer who installed it do the inspection and preventative maintenance work. Allowing other contractors to work on a roof may invalidate some or all of the warranty.

CHIMNEYS

Stay warm, inspect your chimney for loose or deteriorated bricks or mortar. If covered with stucco, look for cracks or loose sections. Chimney caps should be inspected for loose or broken sections, as should the protruding clay chimney liners.Chimney flashings should be scrutinized for leakage. Efflorescence — a white salt build-up on the chimney — indicates moisture within the chimney and further investigation is required.

SUMP PUMP

If your property has below-grade parking or a basement, you probably have a sump pump whose job it is to remove water and keep it from pooling. Flooding not only can damage the structure but wreaks havoc with personal property that may be in the area. During the dry months, dirt and other debris can accumulate to inhibit the proper functioning of the device. The electrical wires can become loose or severed. To test, take a garden hose and run water directly into the drain to which the pump is connected. You will know right away whether it is working or not. It is advisable to have your gardener run water into the sump pump pit each time they visit the property. This will alleviate the smell of stagnant water and will ensure continual operation of the device.

DECKS AND WALKWAYS

Cracks and chips in magnesite decking should be repaired and sealed. Water leaks, which penetrate magnesite, can, among other things, damage the wood frame members underneath causing dry rot, which can spread and in extreme cases compromise the structural safety of the support system.

WEATHER PROOFING

Check the weather-proofing around doors and windows. Leaks at these points usually cause expensive interior damage to ceilings, walls and flooring.

HEATER

The gas company will do this free and will actually do some types of repairs, however the actual tenant must request the service. The heaters have to be turned on to be checked. Do some rainy season preventative maintenance, and you may lessen the risk of leaks, dry rot, mold and other roof issues. Minimizing repair bills, extending the life expectancy of many components and perhaps reducing energy consumption are other up sides to preventative home maintenance. For information on Southern California investment properties there is a great Web site at www.SoCalInvestmentRealEstate.com.

(Jodi Summers is director of the investment division
at Boardwalk Realty. For your real estate needs, email