Palmdale Retail Center Sells for $13.5 Million

A 58,652-square-foot retail center anchored by Smart & Final and Barnes & Noble sold for $13.5 million, wrapping up a three-year, piece-by-piece liquidation of a multi-property portfolio inside Palmdale Marketplace.

The buyer is a private investor out of Southern California. The seller, a family office with retail holdings across the country, tapped Matthew Mousavi and Patrick Luther, both Senior Managing Principals at SRS, to handle the transaction.

Worth pausing on the lease structure here. Both tenants had 10 years left on their triple net leases when the deal closed. Under that arrangement, the tenant picks up most of the property’s operating costs: taxes, insurance, maintenance. The landlord just collects checks. For a passive investor, that’s a clean setup with predictable income and no real management burden. That’s the profile that attracts high-net-worth buyers who want income, not a second job.

Luther explained the buyer selection in a statement: “Due to the offering being grocery anchored under newly extended leases, we received multiple offers from private and institutional profiles, ultimately selecting a local high net worth investor,” Luther said.

The building itself went up in 1999. It’s a tight, two-tenant parcel sitting inside the broader Palmdale Marketplace complex, which counts Target Corp., Lowe’s, and Sprouts among its major anchors. The surrounding center draws consistent traffic, which makes individual parcels within it easier to underwrite and easier to sell.

This wasn’t a one-off deal. It’s the sixth and final transaction in a deliberate break-up of the seller’s Palmdale Marketplace holdings, a strategy Mousavi and Luther executed over roughly three years. Previously sold assets included the Shops at Marketplace plus individual pads occupied by Vitamin Shoppe, Five Guys, and Café Rio, among smaller operators. The six transactions combined came to $32 million.

The logic behind selling retail assets piece by piece rather than in a single package is straightforward, and it’s playing out across suburban retail corridors throughout Southern California. Institutional buyers want a discount when they take on scale and complexity. Private investors, on the other hand, will pay up for a clean, well-leased asset they can actually get their arms around. Break a portfolio into smaller, digestible pieces and you don’t just simplify the sale. You widen the buyer pool and force competition.

Thirteen deals of this type don’t all land the same way. But Mousavi argued the strategy worked as intended.

“We have successfully created significant additional value for our client by breaking up the asset and selling to private investors at more favorable price points than if we were to transact with a single buyer, ultimately maximizing returns for the seller,” Mousavi said.

The numbers bear it out. Five prior sales of Palmdale Marketplace parcels going back to 2019 generated returns before this final piece. Add the $13.5 million from the Smart & Final and Barnes & Noble parcel and the full portfolio cleared $32 million across all six transactions, closing in 2026.

It’s the kind of outcome that doesn’t get much attention in deal announcements but it’s what good asset management looks like in practice. The original acquisition, a family office holding retail parcels built around a 1999-era center anchored by national tenants, wasn’t built to be sold whole. Institutions weren’t lining up. So the seller’s team went the other direction, identifying which buyers wanted which pieces and pricing accordingly.

The LA Business Journal first reported the transaction details. The 60-month runway Mousavi and Luther took to work through the portfolio is longer than a typical disposition timeline, but the total return suggests the patience was deliberate, not slow.

For context, the Palmdale Marketplace complex isn’t the kind of asset that generates a lot of press in Los Angeles real estate circles. It’s a working suburban center with national tenants and solid traffic, but it doesn’t have the trophy cachet that drives headlines. What it did have was a family office willing to let its advisors run a disciplined, multi-year process rather than rush a single sale to close a quarter.

That’s what the $32 million represents. Not a splashy trade. A patient one.