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- April 1, 2015: Vol. 27, Number 4

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On the West Coast waterfront: Big ships and diesel in the salt air mean rising property values, but keep an eye on the Panama Canal

by Benjamin Cole

1 When many investors think of “institutional property,” visions arise of trophy office towers, high-end shopping complexes or internationally recognized destination resorts. But in today’s market, add to that list plebeian waterfront properties in a growing number of port cities, including Los Angeles. Indeed, buyers might pay nearly as much for a warehouse as a downtown office building on a per-square-foot basis, a situation unheard of only a few years back. In December 2014, for example, Rexford Industrial Properties, a public REIT specializing in Southern California industrial-warehouse properties, bought a 63,654-square-foot, logistics-oriented warehouse complex near the ports and Los Angeles Airport for $173 per square foot. To put that per-square-foot figure in context, recall in 2013 the tallest, most iconic and best-known office skyscraper in Los Angeles’ downtown — the U.S. Bank Tower — sold for $262 a square foot, admittedly higher than Rexford Ind

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