A new investment opportunity has recently been made available in Santa Barbara. According to a marketing brochure from SRS National Net Lease Group, a recently renovated Whole Foods property in Santa Barbara is up for sale with an asking price of $59.2 million, or approximately $1,980 per square foot.
The property, located at 3761 State St., is currently owned by Ocean Market Properties LLC, an entity affiliated with David S. Blatt of Westlake Village, according to public records. That entity acquired the property in 2019 for $43.8 million, or about $1,465 per square foot.
The retail asset boasts 29,884 square feet on nearly two acres of land and features 178 parking spaces.The interior also underwent a comprehensive remodel in 2022, with Whole Foods Market, the longstanding tenant with over 15 years of operation at this location, investing approximately $3.5 million in renovations.
With 11 years remaining on the initial lease term and six five-year extension options, the tenant has been at the site for many years. The current lease includes a 10 percent rental increase in November 2029 and at the start of each option, providing a growth in net operating income and a hedge against inflation, per the marketing brochure.
In 2022, the tenant reported an impressive $41.7 million in annual sales.
The property is positioned along State Street, a major retail and commuter thoroughfare that sees approximately 25,300 vehicles passing by daily. The property is also closely situated to US Highway 101 and is within a dense retail corridor, with neighbors including Gelson’s, Bristol Farms, Trader Joe’s, Target and Chipotle, among others.
The property’s advantageous location is further highlighted by its proximity to the affluent residential community of Hope Ranch, one of Santa Barbara’s most sought-after neighborhoods, boasting a median home value of $5.1 million. Overall, the five-mile trade area is supported by over 132,000 residents and 88,000 daytime employees, with an average household income of $156,600 per year.
