Dec 2025 LA Warehouse Sale Price Point
https://www.credaily.com/briefs/amazon-warehouse-sale-breaks-record-in-…
not sure how I missed this from a couple months ago but am I reading this right that an amazon leased ~140,000 sf warehouse near LAX sold at almost $1500/sf??? how does that even work, what am I missing here? Was this just poor reporting? SoCal people pls chime in if you know, I am just kinda shocked and am wondering if I am overlooking something
Not from SoCal but it’s accurate. Just under a 5.5 cap with ~14 years remaining on the lease. If the developer paid 800/SF for the land under the building, 1,500 PSF probably isn’t that far above the cost basis. There’s car parking on the roof so the structure is more complicated than your average tilt wall box. Again, not from SoCal and don’t cover the market so I don’t have any context around whether the ~$80 rent Amazon is paying is market.
$80/sf for industrial is kinda mind boggling to me, I'm not too familiar with this area either so that's why it really jumped out at me
$80/SF is a pretty healthy price to pay for an entire building in my market.
I imagine Amazon pays a huge rent to be next to LAX. Imagine how many of their products come through there
yeah but 140k sf would be way too small for a fulfillment center (what I would expect coming in from LAX), this would have to be a delivery station or maybe sortation center no?
Yeah likely just a sorting facility, not fulfillment, to have better reach to LAX and allow them to better fan things out to the other delivery stations and fulfillment centers.
the rent to warrant that valuation though still blows my mind...maybe I just haven't kept up enough with socal industrial rents in recent years
I'm not an industrial guy but I looked at some comps, and you're certainly right, this is definitely a record for the books.
I do wonder why Amazon is so willing to pay a hefty premium to be that close to LAX. Gardena, Hawthorne and Inglewood would be cheaper places to have a warehouse/distribution center but still be within close proximity to the airport. It's really strange because they did a huge layoff of 30k employees since October and have decided to shut down Amazon Fresh stores. Do they really expect this new LAX location to generate returns above their cost of operations there?
95% sure it’s an IOS deal.
hmmm looking on google maps, it looks like a delivery station with parking on the roof, but just adjacent across 96th st to the north, I am seeing a giant parking lot which looks filled with amazon delivery trucks, so maybe the sale price includes this land too?
There's 13.4 acres total. Works out to $362/land foot. Still the highest IOS comp I've ever seen but maybe justifies the price more.
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