Mid-Cities Los Angeles - CA

Retail Submarket Report Mid-Cities Los Angeles - CA PREPARED BY Brendan Broussard Mid-Cities Retail RETAIL SUBMARKET REPORT Submarket Key Statistics 2 Leasing 3 Rent 7 Construction 9 Sales 14 Sales Past 12 Months 15 Supply & Demand Trends 17 Rent & Vacancy 21 Sale Trends 25 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Overview Mid-Cities Retail 12 Mo Deliveries in SF 12 Mo Net Absorption in SF Vacancy Rate 12 Mo Rent Growth 73.9 K 5.3 K 4.7% 1.3% The Mid-Cities retail submarket is the largest in the L.A. positive, has been anemic. metro, with over 50 million SF of inventory. The Supply additions have been modest over the past submarket covers a wide area with many cities, most of several years, and the current pipeline is dominated by which have middle- or lower-income demographics. one 100,000-SF project in Compton. Recent sales Asking rents are the lowest among the major submarkets volumes are in line with historical norms. Pricing for retail in the metro. assets in the Mid-Cities, while at a discount to most other areas of the metro, is at record levels and Like the metro, vacancies have increased since late demonstrates that investors see properties with the right 2017, as closings have not been enough to offset store characteristics as attractive holds. closures. Rents have moved largely in tandem with the greater market, as well. Recent rent growth, while KEY INDICATORS Net Absorption Under Current Quarter RBA Vacancy Rate Market Rent Availability Rate Deliveries SF SF Construction Malls 4,825,627 5.9% $3.11 0.4% 0 0 0 Power Center 3,099,098 2.6% $2.66 2.9% 0 0 0 Neighborhood Center 11,641,356 6.8% $2.21 11.7% (10,324) 0 0 Strip Center 5,551,054 5.5% $2.04 6.4% 2,757 0 0 General Retail 24,986,941 3.6% $1.91 4.5% 3,652 0 12,100 Other 184,025 1.3% $1.92 6.7% 0 0 85,359 Submarket 50,288,101 4.7% $2.16 5.9% (3,915) 0 97,459 Historical Forecast Annual Trends 12 Month Peak When Trough When Average Average Vacancy Change (YOY) 0% 4.9% 4.9% 6.1% 2010 Q2 3.3% 2006 Q3 Net Absorption SF 5.3 K 194,861 63,468 1,061,111 2016 Q2 (496,022) 2009 Q1 Deliveries SF 73.9 K 318,027 144,656 976,827 2016 Q3 28,770 2015 Q3 Rent Growth 1.3% 1.1% 0.9% 5.4% 2007 Q2 -5.7% 2010 Q2 Sales Volume $284 M $285.1M N/A $660.8M 2018 Q4 $80.5M 2011 Q3 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 2 Leasing Mid-Cities Retail Vacancies in the Mid-Cities have been on an upward former Toys R Us location, and the lease is set to trend for two years and are currently 4.7%, above metro commence in May 2020. averages. In terms of large move-ins, Chuze Fitness took occupancy in early 2019 of 62,100 SF in Cudahy, Absorption in 2019 was weak, as store openings have backfilling a former Kmart space. In June, Sky Zone not been enough to offset closures. Fallas Paredes Trampoline Park opened a 27,100-SF location in closed a location in Compton at the beginning of the Cerritos. year, vacating 30,000 SF. Gold Fortune Supermarket in Cerritos shuttered during the fall, leaving behind a Looking at recent signings and pending move-ins, in 23,200-SF space. Also of note, Kohl’s vacated a portion October 2019, an undisclosed tenant signed for 40,000 of its 88,100-SF store in Cerritos in the summer of 2019, SF at 11340 South St. in Cerritos. The location was a with 20,900 SF currently available for lease. NET ABSORPTION, NET DELIVERIES & VACANCY 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 3 Leasing Mid-Cities Retail VACANCY RATE AVAILABILITY RATE 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 4 Leasing Mid-Cities Retail 4 & 5 STAR MOST ACTIVE BUILDINGS IN SUBMARKET - PAST 12 MONTHS Property Name/Address Rating GLA Deals SF Vacancy (QTD) Net Absorption SF (QTD) 408-530 E Washington Blvd 101,095 2 2,900 2.9% 0 University Square Shopping… 6,394 2 3,516 31.4% 0 501 E Albertoni St 111-131 E Compton Blvd 55,232 1 8,400 0% 0 2321 E Florence Ave 8,620 1 1,332 0% 0 200-208 Towne Center Dr 59,673 1 2,000 0% 0 Pad A 3,400 1 3,400 0% 0 821 W Rosecrans Ave 10727-10833 Long Beach Blvd 75,733 1 3,040 19.8% 0 10901-10923 Atlantic Ave 39,180 1 8,100 0% 0 Downey Marketplace 57,940 1 2,518 0% 0 8610-8626 Firestone Blvd Gateway Plaza 51,331 1 972 0% 0 1540-1700 W Rosecrans Ave 10917-10949 Firestone Blvd 44,165 1 1,630 20.2% 0 Bldg A 26,708 1 1,134 0% 0 11401-11489 South St 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 5 Leasing Mid-Cities Retail 3 STAR MOST ACTIVE BUILDINGS IN SUBMARKET - PAST 12 MONTHS Property Name/Address Rating GLA Deals SF Vacancy (QTD) Net Absorption SF (QTD) 2120-2186 E Florence Ave 36,804 5 15,699 30.3% 0 Bellflower Plaza 41,060 4 3,600 8.8% 0 17610-17620 Bellflower Blvd Bullis Town Center 9,157 4 2,210 0% 0 1842 N Bullis Rd 17141-17163 Bellflower Blvd 13,315 3 2,616 4.5% 0 Ryans Plaza 55,115 3 5,628 4.7% 0 5443-5835 Bellflower Blvd Downey Center 37,000 3 2,266 3.9% 0 9901-9915 Paramount Blvd Pacific Plaza 15,040 3 3,970 6.8% 0 5610 Pacific Blvd 4701-4721 S Broadway 15,470 3 3,389 9.0% 0 15961-15985 Piuma Ave 26,100 3 7,798 7.0% 0 Seafood City 52,382 3 3,000 0% 0 17202-17298 Norwalk Blvd 9733-9739 Long Beach Blvd 4,797 3 3,200 0% 0 4846 Florence Ave 6,725 2 2,600 0% 0 9418-9430 Firestone Blvd 7,718 2 2,910 18.3% 0 11405 E Firestone Blvd 10,175 2 1,400 0% 0 Bldg. A 10,435 2 2,681 0% 0 11660 South St 655-667 E University Dr 14,830 2 3,455 0% 0 2864 E Florence Ave 5,949 2 4,000 0% 0 4070 S San Pedro St 820 2 820 0% 0 6040-6048 Atlantic Blvd 7,287 2 2,419 0% 0 Maywood Towne Center 20,510 2 3,960 0% 0 4420-4444 Slauson Ave 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 6 Rent Mid-Cities Retail Current year-over-year gains in the submarket, 1.3%, modest outperformance with repsect to gains, whereas mirror the greater metro’s pace. Like the metro, strip, general retail and power centers are slightly lagging. neighborhood, and mall retail subtypes are seeing MARKET RENT GROWTH (YOY) 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 7 Rent Mid-Cities Retail MARKET RENT PER SQUARE FOOT 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 8 Construction Mid-Cities Retail The Mid-Cities has seen modest supply additions in Compton (130,000 SF in 2016). recent years, with the largest projects completed since Looking forward, there is 97,000 SF underway, the 2014 including the Promenade at Downey (640,000-SF majority of which is in the soon-to-complete Freedom power center completed in 2015 and 2016), the Toyota Plaza. The shopping center is part of the redevelopment Dealership of Downtown Los Angeles (290,000 SF in of the Jordan Downs public housing projects in Watts. 2019), the Azalea Shopping Center in South Gate (230,000-SF power center in in 2014), and a Walmart in DELIVERIES & DEMOLITIONS 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 9 Construction Mid-Cities Retail All-Time Annual Avg. SF Delivered SF Past 8 Qtrs Delivered SF Next 8 Qtrs Proposed SF Next 8 Qtrs 304,952 165,010 97,459 565,442 PAST 8 QUARTERS DELIVERIES, UNDER CONSTRUCTION, & PROPOSED PAST & FUTURE DELIVERIES IN SQUARE FEET 1/6/2020 Copyrighted report licensed to Keller Williams Realty - 1023202. Page 10 Construction Mid-Cities Retail RECENT DELIVERIES Property Name/Address Rating Bldg SF Stories Start Complete Developer/Owner Multi-Tenant Popeyes De… Southwest Group LLC 1 4,100 1 Jun-2019 Dec-2019 1495 N Wilmington Ave Prominent Realty 9928 Artesia Blvd - 2 3,728 2 Jan-2019 Nov-2019 - 1302 E Slauson Ave - 3 8,000 1 Jun-2018 Oct-2019 - 17404 Bellflower Blvd - 4 3,000 1 Aug-2018 Oct-2019 Jacob P. Sonenshine IN-N-OUT - 5 3,867 - Apr-2019 Oct-2019 2200 W Artesia Blvd - 5707 Pacific Blvd - 6 8,396 2 Nov-2017 Oct-2019 Prajin Enterprises Freedom Plaza - 7 3,000 1 Sep-2018 Aug-2019 9901 S Alameda St Federal Realty Investment Trust Freedom Plaza - 8 9,000 1 Sep-2018 Aug-2019 9901 S Alameda St Federal Realty Investment Trust 12202 Paramount Blvd - 9 5,774 1 Jun-2017 Apr-2019 Robert Amin 8028 3rd St - 10 1,900 1 Jul-2018 Apr-2019 Dr.

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