MOST ACTIVE BUYER IN SAN DIEGO
It’s not the Beach Boys, but SR Commercial boasts sandy beaches, surfing, fast cars, and Pet Sounds (if you bring your own pet). One more thing it can brag about: acquiring its sixth property so far this year in San Diego, with No. 7 in escrow.
SR is rapidly expanding its acquisition. (Colliers International’s Henry Zahner calls the firm the most active buyer in the San Diego market.) On Friday, we chatted with principals CJ Stos and Adam Robinson, who co-founded the Solana Beach-based CRE investment and third-party management firm. Adam tells us four of the deals purchased this year were bank foreclosures. The seventh, a 25k SF R&D building in Carlsbad, should close at the end of this month. A former broker in Orange County, CJ says it helps to have good relationships with brokers who give them the first call when a bank hires them to sell a property (better than the last call at Karl Strauss).
Adam says the firm focuses on two investment strategies. The first is a short-term game plan where it finds distressed assets that it can retenant or rehab and hold for three years. An example is a 23k SF office/flex building in Sorrento Mesa, where it replaced the roof and HVAC units, and redid the parking and landscaping. SR also has a long-term hold of 10 years or longer for properties it wants to add to its portfolio, like a vacant 50k SF, four-tenant distribution building it just bought in San Marcos. In addition, the firm always retains the selling brokers to serve as the properties? leasing agents.
The firm’s bread-and-butter has been in the $2M to $7M range, but with new institutional partners such as opportunity funds, the firm’s pursuing larger properties of up to $50M. SR made it to the final round for a $40M industrial portfolio in the South Bay of LA. Adam “grew up in Northern California where it’s too cold to surf,” so his hobby is racing cars. Avid surfer CJ has ridden waves in Fiji, Tahiti, Samoa, Hawaii, and the Maldives. He says a lot of the firm’s clients and vendors surf too, so often they’ll all walk down to the beach and “talk business in the water. We call that a board meeting.”
Article source: Bisnow.com