SAN DIEGO – Hazard Center, a Mission Valley shopping center, has been sold for an undisclosed price to a Los Angeles real estate investment firm, BH Properties.
BH Properties plans to make improvements to the center, but no major renovation is planned, said BH President Jim Brooks.
President
BH Properties
“It’s in really good shape,” Brooks said. “We don’t intend to radically alter what that property has and delivers to the community.”
The 14.5-acre shopping center includes a 15-story, 270,000-square-foot office tower and 135,000 square feet of retail space.
The retail portion of Hazard Center was completed in 1989 followed by the office tower in 1990.
Brooks said that the tower is 77% leased to long-term tenants, while about 70% of the retail space is leased and BH Properties plans to keep them.
“The existing tenants there are in really good shape. We don’t intend to displace any tenants there,” Brooks said. “There are legacy tenants that have been in that property for some time. They all have leases in place. We don’t pursue a strategy of buying out tenants. We intend to work with them and ensure they’re good, long-term tenants.”
Brooks said that BH Properties plans to put the center through a “light renovation,” starting within the next 90 days and finishing in “nine months or so.”
“When I say light renovation, some modifications to the façade, signage, some of the wayfaring and then the tenant facades, identification – things like that. All of this work will certainly be coordinated with the existing tenants,” Brooks said.
Retail tenants include Barnes & Noble, Orange Theory Fitness, BJ’s Brewhouse, Wood Ranch BBQ & Grill, Which Wich Superior Sandwiches, and FedEx Office.
Changes will include renaming the center. Beyond that, Brooks said that his firm hasn’t settled on a final design for the renovation.
“We are in discussions with several architectural firms to help us evaluate that,” Brooks said.
More to Come
Brooks said that BH Properties was attracted to Hazard Center because of its “phenomenal location” where Route 163 intersects Friar Road and near the recently remodeled Fashion Valley Mall.
“We’ve had our eye on San Diego County, and now that pricing has become a little more favorable, we found the perfect asset to acquire,” Brooks said. “We’ve been looking around, I’d say in earnest, for 18 months, 24 months or so.”
The firm is looking for more property to buy in San Diego County.
“We’re not only buyers of retail and office, we’re buyers of industrial, affordable housing and market-rate housing,” Brooks said, although he said that, “I don’t think you would see us looking for industrial down in the Otay Mesa market.”
He said that the firm prefers centrally located multi-use property, like Hazard Center.
In deals similar to the Hazard Center acquisition, Brooks said that BH Properties just closed on the sale of Anchorage Square in San Francisco and, earlier this year, bought Pacific Place Shopping Mall in downtown Seattle.
“Our strategy coming into 2024 was to continue our growth and expansion through opportunistic investing in value-add projects,” Brooks said.
Founded in 1993, BH Properties has regional offices in San Francisco, Phoenix, Dallas, Houston, Seattle and Riverside. The firm owns 100 properties in 14 states and Puerto Rico.
“California has always been a little bit more difficult market to get into in certain locations simply because of pricing,” Brooks said.
The Hazard Center sale was arranged by Eastdil Secured, a global real estate investment bank, based in New York.
“This transaction underscores the strong demand for high-quality, well-located, mixed-use assets in the resilient San Diego market,” said D. Michal Van Konyenburg, president of Eastdil Secured.
BH Properties
FOUNDED: 1993
HEADQUARTERS: Los Angeles
PRESIDENT: Jim Brooks
BUSINESS: CRE Investment
NUMBER OF EMPLOYEES: 100
WEBSITE: www.bhproperties.com
CONTACT: 310-820-8888
NOTABLE: BH Properties owns 11 million square feet in 16 states and Puerto Rico.