The Palm Desert company’s purchase of Galleria, Elegante and Park Plaza greatly expands The Shops on El Paseo, adding restaurants, boutiques, offices and new leasing opportunities to one of the region’s most important retail corridors.
On a shopping boulevard built around carefully curated storefronts, Chartwell Properties has made a move measured not in individual suites, but in entire commercial buildings.
The Palm Desert-based company acquired three prominent El Paseo properties for a combined price of nearly $21.5 million, adding approximately 61,000 square feet of retail, restaurant and office space to The Shops on El Paseo, its expanding collection at the western end of the district.
The purchases include Galleria at 73111 El Paseo, Elegante at 73151 El Paseo and Park Plaza at 73200 El Paseo. The transactions closed within days of one another in June, creating a substantially larger and more contiguous Chartwell footprint along one of the Coachella Valley’s most valuable commercial corridors.
Chartwell Properties has purchased Park Plaza at 73200 El Paseo.
The scale is significant. Before the acquisitions, The Shops on El Paseo was described as a collection of more than 100,000 square feet encompassing 27 fashion, home and dining destinations. Adding the three buildings appears to increase that footprint to more than 160,000 square feet, giving one locally based owner and manager control of a major concentration of space at the gateway to Palm Desert’s signature shopping district.
This is not simply the arrival of another store or restaurant on El Paseo. It is a large commercial real estate consolidation involving dozens of suites, multiple property types and a tenant base that ranges from destination dining to apparel, jewelry, home furnishings, specialty retail and professional services.
Three properties, one major expansion
The Galleria was the largest and most expensive of the three purchases. Chartwell paid $8.65 million for the roughly 27,500-square-foot multitenant retail and office property.
Elegante, a two-story building of approximately 19,300 square feet, sold for $6.383 million. Park Plaza, a fully leased multitenant retail property of about 14,300 square feet, sold for approximately $6.45 million.
Together, the properties traded at an average of roughly $352 per square foot. Elegante and Park Plaza were marketed as triple-net investments at capitalization rates of approximately 5.75 percent, underscoring the value placed on stabilized retail real estate in the El Paseo corridor.
The transaction also creates a much larger platform for future leasing. Some of the acquired space is available, giving Chartwell an opportunity to recruit additional restaurants, boutiques, specialty concepts and professional services to complement the businesses already operating within the buildings.
A broader mix of businesses
The newly acquired properties bring an established group of restaurants, boutiques and service businesses into Chartwell’s portfolio.
Tenants identified by the company include The Venue Sushi and Spirits Redefined, JC’s Cafe, Blonde Clothing Boutique, Chrissy’s on El Paseo and Maison Felice. The buildings also contain professional offices and available suites that can be marketed to new tenants.
They join a Chartwell-controlled collection that already includes a notable cross-section of national brands, independent retailers and restaurants.
The Shops on El Paseo restaurant lineup includes California Pizza Kitchen, Daily Grill, Eddie V’s, Kitchen 86, Mole, Porta Via, Shake Shack and Winston Pies.
Its retailers and service businesses include Athleta, Chico’s, Ralph Lauren, RH The Gallery on El Paseo, Roche Bobois, Vuori, Warby Parker, White House Black Market, Oliver Peoples, Lovesac, The Shade Store, Soma and several locally oriented boutiques and professional firms.
That variety is central to the importance of the transaction. Chartwell is not assembling a conventional shopping center dominated by a single merchandise category. Its portfolio now spans luxury apparel, contemporary fashion, eyewear, furniture, interior design, financial services, fast-casual dining and full-service restaurants at several price points.
The acquisition also gives the company greater ability to shape what comes next. Ownership of adjacent or nearby properties can make it easier to coordinate leasing, building improvements, events, marketing and the overall customer experience.
“My team and I are excited to expand The Shops on El Paseo with these three great properties,” said Fred Fern, president of Chartwell Properties, Inc. “We are looking forward to bringing new energy, experiences, and opportunities to The Shops on El Paseo while continuing to support our tenants and contribute to the continued success of Palm Desert’s premier retail district.”
A major position within a major district
El Paseo is not a typical neighborhood retail street. The eight-block district is promoted as having more than 300 shops, along with restaurants, galleries, design showrooms, spas and professional services.
The Gardens on El Paseo alone contains more than 50 stores and restaurants, including an assortment of luxury, designer and nationally recognized brands.
Within that larger setting, a 61,000-square-foot acquisition is substantial. It is larger than many neighborhood shopping centers and represents a meaningful amount of commercial space at the western end of the boulevard.
The deal comes as El Paseo continues to evolve beyond its long-established identity as a seasonal luxury shopping destination. Newer brands, expanding restaurants, home design concepts and year-round dining have broadened the district’s appeal to full-time residents as well as visitors and seasonal homeowners.
For Chartwell, the acquisition deepens a strategy that has been underway for decades. Founded in 1974, the company specializes in upscale retail and restaurant properties and has played a central role in the redevelopment and tenanting of the western end of El Paseo.
For Palm Desert, the transaction places an even larger portion of its most recognizable commercial corridor under the management of a company headquartered in the city and closely identified with the district.
The ultimate impact will depend on how Chartwell fills the available spaces, integrates the properties and invests in the buildings. But the dimensions of the deal are already clear: three buildings, nearly $21.5 million, roughly 61,000 square feet and a wide range of businesses added to an already extensive retail and dining portfolio.
On El Paseo, where individual openings often generate attention, Chartwell has made a move on an entirely different scale.
Bob Marra is the CEO/Publisher of GPS Business Insider. He has been studying, writing and giving presentations about business, economic and public affairs news and issues and the local economy in the Greater Palm Springs/Coachella Valley region for more than 20 years.
