Steve Jaffe, executive vice president and general counsel for BH Properties of Los Angeles, doesn’t shy away from buying dark real estate — a primary reason his firm targeted Los Altos Crossing in Sparks.
The retail center at Los Altos and Sparks boulevards is 53-percent vacant and includes some virgin shells in its 35,123-square-feet of space under roof. But BH Properties had long been bullish on northern Nevada and is optimistic about leasing up the center over the next few years in the growing north Sparks area. BH Properties owns a diverse mix of nearly 100 office, retail, multi-family and warehouse/industrial properties in 15 states.
“We have been looking for a long time to find something in the Reno market,” Jaffe says. “Reno is poised for a lot of growth given its location and some of its market demographics. We view it as a very business-progressive market.”
Jaffe says Los Altos Crossing sits in the path of future development in Sparks, which could be prompted in part by the buildout of Tesla’s gigafactory in Tahoe Reno Industrial Center. In addition to tenants such as Dotty’s, Dad’s Convenience Store, Las Trojes Mexican Restaurant and Goodwill, Los Altos Crossing also has just over 217,000-square feet of pad-ready space for additional development.
“We liked it before the Tesla announcement, and that just vindicates what we thought,” Jaffe said last week from BH Properties’ offices in Los Angeles. “It’s well built, and there’s the ability to sell off pads or continue to develop for whatever the community needs.”
BH Properties specializes in purchasing underperforming real estate and boosting vacancy through aggressive leasing terms. Its primary points of focus in recent years have been Phoenix, Las Vegas and southern California.
“We like buying vacancy — it allows us to come in and beat the market as a result of our entry price (for leasing). We saw this as great opportunity to dip our toes into the Reno-Sparks marketplace.
BH Properties is working with Ken Mattison, senior vice president of retail services at Coldwell Banker Commercial, to lease out Los Altos Crossing. Jaffe says his firm most likely will add to its portfolio in northern Nevada — and to hold rather than sell.
“Our typical plan, once we plant a flag in a market, is to try and add to it so that we see some economies of scale. We are actively looking for more real estate to buy.
“We like to buy and lease; we are long-term holders. We have an acquisition strategy, and our disposition strategy is more on a property-by-property basis.”
