Retail real estate expected to thrive in second half.

SEVERAL shopping center sales in the local area are reflecting recent projections that the market for retail properties is heating up.

Pension fund Cornerstone Real Estate Advisors just purchased Northpark Village Square, an 87,595-square-foot complex in Valencia for $30 million. And Panorama Square Shopping Center a complex in Panorama City that has long been languishing, was sold for $11 million.

The new activity comes as L.A. area retail properties overall see increased returns.

According to a report recently released by Marcus & Millichap, the average revenue per square foot at L.A. area shopping centers has increased by more than 5 percent in a little over a year.

The Marcus & Millichap study, which ranks L.A. as the No. 8 market for retail real estate properties based on high rent growth and vacancy rates, predicts that the economic recovery will increase property prices through the rest of this year.

About 3 million square feet of retail space will be completed throughout L.A. this year, down from 3.9 million in 2003. But the limited construction coupled with expansion by national retailers is expected to strengthen the leasing market, the report said.

"Vacancies are expected to decline by 69 basis points during 2004 to 4.5 percent," the report revealed.

A 4.7 percent rise in retail rents is expected, bringing the average rental to $24.24 per square foot.

Northpark Village Square, at 27706-27776 McBean Parkway, was fully leased at the time of the sale. Tenants at the center include Ralphs, Rite Aid and Wells Fargo.

The property was sold by Lennar Partners, which acquired it as part of the Newhall Land and Farming Co. portfolio.

Michelle Schierberl, Tom Lagos and Ken McLeod, brokers with Grubb & Ellis, represented both the buyer and the seller in the transaction.

The Panorama City center, an 87,771-square-foot complex anchored by Robinson's May Clearance Center, sold for $11 million.

Chris Thompson, a broker with Investment Real Estate Associates, represented the seller, Gold Realty Co.

The buyer, Reliable Properties, was represented by Thompson and IREA's Tony Lee.

Gold Mountain Responds

Officials at Gold Mountain Enterprises LLC took exception to the way I characterized the status of their mixed-use development parcel on Ventura Boulevard in Encino in the last issue.

From their point of view the parcel, which is entitled for 125 apartment units and 17,000 square feet of retail space, "has been well received by several active apartment developers," said Athena Novak, property manager at Calabasas-based Gold Mountain.

Gold Mountain "has very selectively chosen to go into escrow with only a very few of the top apartment developers and apartment REITs," she said. "However, one was not able to raise all their money before the close of our escrow period and others had requested unreasonable discounts from the agreed selling price."

She said that the company did not agree to further extensions and canceled the escrows.

Gold Mountain is now in negotiations with what Novak said were a few of the largest public homebuilders in the country who are considering building luxury condominium units along with retail on the site.

She added that the company, which took the property through the entitlement process before putting it on the market for sale, is also considering developing the site itself.

Apartment Sale

Grand Villas, a 104-unit apartment community in Sherman Oaks, was sold for just under $18.8 million.

The complex, at 15101 Magnolia Boulevard, was acquired by Miles Cooperman Family Trust, Encino.

The seller was The Bascom Group, Irvine.

Dean Zander, David Casper, Joe Leon and Paul Runkle at Hendricks & Partners, represented buyers and sellers.

Chatsworth Lease

S2K Graphics leased a 32,000-square-foot facility in Chatsworth in a five-year deal valued at $1.2 million.

S2K, formerly named Signs 2000, is a graphic design and marketing company that is moving from its Canoga Park headquarters due to expansion.

The new facility is located at 9255 Deering St.

Both the tenant and landlord, Northpark Industrial, were represented by Scott Caswell at Delphi Business Properties.

Burbank Sale

A 31,000-square-foot office building in Burbank has sold for more than $4 million.

The property, at 1405 San Fernando Blvd., also included an adjacent land parcel.

The buyer, Three D Properties LLC, was represented by Larry Iles and Ken Kneale at GVA DAUM.

The seller, C&P Properties #5 LLC, was represented by Charles Cusumano Real Estate.

Multi-family Action

A 28-unit Northridge apartment complex at 17941 Devonshire Ave. has been sold for $2,980,000.

H. Bruce Hanes, president of Hanes Investment Realty, represented the buyer E. Tabash in the deal.

Hanes Realty also negotiated five other apartment complex sales recently in Van Nuys, Studio City and Sun Valley.

Among them, the company represented the buyer and seller in a deal for a 32-unit apartment complex at 8437 Glenoaks Blvd. in Sun Valley for $ 1,949,000.

Senior reporter Shelly Garcia can be reached at [phone] or by e-mail at [e-mail].