0:22 Riverside County is downgraded to the red tier
1:21 Orange County is inching closer to the orange tier; schools will open this week
1:47 What’s the difference between Costco and Costco Business Center?
3:08 New gondola between Dodger Stadium and Union Station
3:55 My new listing – a 78% vacant center in Hemet, CA
4:46 Nationwide stats for investment sales
5:31 What’s Amazon doing this week to establish world domination?
My trip to the Costco Business Center in Ontario
Costco Business Center in Ontario is open! I had known about it coming soon, but with the pandemic happening, I didn’t get to visit until this past week.
What’s the difference between Costco Business Center and a regular Costco?
The Business Center stores are geared toward small business owners, like restaurant owners. Most of their business is through delivery, and they only deliver to business addresses.
They don’t sell many of the household items like clothing, or rotisserie chickens, and no one was handing out snacks. But they do sell items that you wouldn’t really buy unless you owned a business – like cash registers, commercial appliances, deli meat slicers, and take-out food containers.
They also sell items in huge bulk quantities. So, if 200 cups isn’t enough for you, you can buy 500, 1000, or 1250 cups at one time. There was also a huge walk in refrigerator for cold food – like the size of a small grocery store.
Costco claims that 70% of the items are different between a regular Costco and a business center. But the biggest difference I saw was that there wasn’t a single person in line!
Your regular Costco membership card will get you into a Costco Business Center, too. So if you’re local to Ontario, I’d encourage you to check out the new Costco Business center on Guasti Rd, right off the Haven Avenue exit in Ontario. There are also other locations in Westminster, Commerce, and Hawthorne.
Riverside Progresses to Move into the Red Tier
On Tuesday, Riverside County was downgraded to the red tier in California’s COVID classification system. Unfortunately, San Bernardino County is still stuck in the purple. The classification system is based on the number of new coronavirus cases as well as the percentage of tests that come back positive. This means that businesses like gyms, churches, movie theaters and nail salons can now open indoors with modifications.
Orange County has been in the red tier for two weeks now and is making progress toward the Orange color. Also, this week, public schools in OC are allowed to resume in-person instruction. My son is too young to go to school but I’ve been nervous about putting him back into day care. Good news that makes me feel comfortable is that none of the 139 elementary schools that were granted waivers and have been open have had any positive test cases for the coronavirus.
New Gondola Planned for Dodger Stadium
Before I moved to Los Angeles 13 years ago, I lived in New York, where everyone takes the subway everywhere. So I was surprised and disappointed to hear that there was no train that went directly to Dodger Stadium. A new form of public transportation has been proposed to service Dodger Stadium – a gondola which would transport up to 5,000 people an hour from Union Station to Dodger Stadium in 7 minutes. The company working on this project is headed up by Frank McCourt, a prior owner of the Dodgers.
Environmental review and approvals is expected to be completed by 2022, with construction to begin by 2025, so everything can be completed by the 2028 Summer Olympics.
New Value-Add Investment Opportunity: Alessandro Center in Hemet
Click link for more information and to download offering memorandum: http://progressiverep.listinglab.com/AlessandroCenter/index.cfm
I get a lot of requests from investors looking for value-add deals. Well, look no further! Here’s one of my new listings that I’m working on, alongside my partner Greg Bedell. It’s a true value-add center in Hemet called the Alessandro Center. This is a 78% vacant center – yes you heard that right, it’s only 22% occupied.
The two tenants, a church and a day spa, cover the expenses on the property, so you won’t lose money as you fill up the vacant space. We are offering this 19,000 square foot center for only $1,400,000, or $75/sf. The vacant units average 893 square feet, which is a perfect size for professional tenants such as a CPA, barber shop, dentist, or or other small business.
We estimate that an investor can sell for a profit of almost $1 million dollars, and achieve a 10.4% proforma cap rate and a 46% return on investment by filling up the vacant space. Reply to this email if you’re interested in learning more about this property.
Nationwide Investment Sales Statistics for Q2 2020
What is happening nationwide in retail investment sales? Costar reports that retail investment sale volume in the second quarter dropped from $18 billion in 2019 to $7 billion in 2020. However, the bright spots in retail sales include grocery anchored centers and single tenant net leased properties. For example, the sale of drugstores like CVS and Walgreens were up 8% in the second quarter of this year versus last year.
There’s also significant interest in drive-thru restaurants and dollar stores. Costar predicts retail investment to stay at reduced levels for the near term as states are still rolling out their reopening plans and struggling to keep COVID under control. They expect that high quality and well located retail will continue to be in high demand for the foreseeable future.
What is Amazon Doing this Week to Establish World Domination?
Amazon has announced plans to open 1,500 neighborhood locations, which they call delivery hubs, in suburban areas around the country, to assist with their last mile deliveries to customers. They will be looking to build these smaller 200,000 square foot distribution centers in malls and in mall parking lots. Amazon has already talked about leasing spaces in malls that were formerly occupied by Sears and JC Penney department, but a target of 1,500 locations means they’ll be going to suburban areas, likely to almost every midsize city in the country.
In addition, Amazon has continued to expand its Amazon Air fleet and now has 70 airplanes. It is also doing most of its own ground deliveries, shipping 67% of its own packages directly to customers, relying less and less on services like the postal service or UPS.
I’m definitely feeling very conflicted about this. I do enjoy the convenience of my prime shipping, but are we moving toward a future where everything is going to be controlled by Amazon? I certainly hope not. Competition is good, but no one seems able to compete with Amazon right now.
That’s all I’ve got for this week. Thanks for reading. See you next time!
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