A 24,000 square-foot-medical and office park in Palmdale has been sold for nearly $5 million, according to commercial brokerage firm Lee & Associates – LA North/Ventura Inc. in Sherman Oaks.
L.A.-based private investment group Valerio Court bought the Challenger Business Park at 450 to 460 W. Palmdale Blvd. in the western part of the city for $4.78 million from Martin Properties Inc. in Westlake Village, which developed the complex in 2009. The park sits across the street from the Palmdale Regional Medical Center, around which another developer is planning a 420,000-square-foot wellness village with outpatient services, retail, restaurants, a hotel and eventually residential units.
The land has a long-term lease that runs through 2061, according to John Battle, managing director of Lee & Associates, and who negotiated the deal on behalf of the seller.
The park’s main tenant, the Torres Martinez Desert Cahuilla Indian Tribe, leases just over 13,000 square feet for social services. Progressive Physical Therapy Inc. is also a tenant, according to Lee & Associates.
“The ground lease was very attractive to potential buyers because it allowed for a very high cash-on-cash return of over 15 percent,” Battle said. “Additionally, the existing tenants are stable, long-term occupants with triple net or modified gross leases so the operating costs are lower than they would be for typical office properties with full service gross leases.”