This is the second largest commercial real estate deal in the history of Sacramento, outranked by a transaction closed back in 2007 when Wells Farago Center and other office properties, valued at $760 million. The deal is also the largest in industrial real estate closed this year in California and the second-biggest in the USA, according to Mark Demetre of Jones Lang Lasalle, who helped broker it.

Demetre, as well as other commercial real estate experts, see this massive acquisition of warehouses and other industrial properties as proof of investor’s faith in Sacramento’s commercial property market as a long-term investment. It also marks a significant ownership transfer from a small group of local developers to outside investors, backed by a large infusion of Wall Street money.

Westcore President and CEO Don Ankeny expressed his company’s eagerness to continue the plans drawn up by Benvenuti, who passed away earlier this year.

“Joe was a legendary guy in your marketplace,” Ankeny said. “The opportunity to step into the shoes of his lifetime’s work doesn’t come along very often. When we got wind of that opportunity, we jumped on it.”

After Benvenuti’s death, his heirs made a decision to sell most of his assets.

“It was basically a family decision. My dad passed away a few months ago and my mom a couple of years ago,” said Richard Benvenuti, the late developer’s son.

This major deal included most on Benvenuti’s 13 million square feet commercial real estate holdings. About half of the properties Westcore aquired are located in North Natomas, along North Market Boulevard and Del Paso Road. The other properties are in West Sacramento, Rancho Cordova and Placer County. The Midwest properties included in the deal are mostly made up of distribution centers, light industrial buildings and office buildings from St Louis and Indianapolis.

Image courtesy Contra Costa Times

Chuck Belden of Cushman & Wakefield’s Inland Empire offices noted that this latest deal was just the biggest in a long line of property deals over the last 18 months, and also the biggest of its kind since the beginning of the recession. Being such a global name, the deal is clearly a positive sign, and one that is sure to increase the prestige of the Inland Empire of Los Angeles as a vital business and industry center.

The long road to economic recovery - looking better

The deal at 7010 and 7140, Cajon Boulevard was brokered by CB Richard Ellis. Built in early 2008, the center is owned by a grouping of investors, including CT Realty Investors, Behringer Harvard, Pacific Coast Capital Partners and Westcore Properties. However, the deal with Hewlett-Packard hasn’t stopped the building from being put up for sale this week, according to a news release from CB Richard Ellis, though it is planned that any buyer will have to honor the lease agreement with HP.

Interestingly, the deal means that there are very few options left for businesses looking to move to the Inland Empire. Properties of 700,000 Sq. feet and above have been snapped up left, right and center over the last year, according to Walt Chenoweth, a partner in the Inland Empire office.

It seems that corporations were one step ahead, and are extremely confident about the market’s ongoing recovery, being keen to maximize the advantage of lower rental costs that comes with the end of a recession.