Federal Realty Investment Trust has cashed out of Santa Monica’s Third Street Promenade.
The Bethesda, Maryland-based real estate investment trust has sold eight buildings on Third Street Promenade, just a quarter-mile from the beach, for $103 million, the firm announced on Thursday.
The sale for the eight buildings, which total 185,000 square feet, came out to $556 per square foot. The buyer of the portfolio was not disclosed and the deal has not yet hit property records.
With the deal, Federal Realty is left with nothing on the promenade, ending a more than two-decade streak of ownership. The REIT bought its first building on the strip in 1996, according to financial filings.
In December, Federal Realty offloaded a 12,300-square-foot store, leased to Dodgers Clubhouse, a merchandise store dedicated to the Los Angeles baseball team, for $17.2 million, records show. Pasadena-based Global Mutual Properties bought the building.
The Third Street Promenade cost Federal Realty about $29 million between 1996 and 2000, according to an annual filing. The development was part of a push by the city to lure Santa Moncia residents to its Downtown.
“The promenade turned Santa Monica into a community with both a beach and a quality urban environment,” Denny Zane, an activist involved in the creation of the development, told the Los Angeles Times in 2014.
But after the pandemic hit in-store retail sales, many retailers, including Banana Republic and Old Navy, decided to cut their Third Street Promenade spaces.
About a quarter of the Third Street Promenade is available for lease, according to SFGate, with 72 of the 97 of the ground-floor storestrongs occupied.
Most of the vacancy lies within the 1200 block of the promenade, where a number of Federal Realty’s properties sat.