Buyers Get Triangle Square for 32% Off

Triangle Square, Costa Mesa’s star but not quite stellar downtown shopping center, was sold Thursday to a private investment group for a reported $47 million--32% less than it cost to build the 6-year-old complex.

San Francisco-based Capital & Counties USA, which built the center for $62 million in 1992, confirmed the long-rumored sale in a terse announcement. Terms were not disclosed and the new owners, represented by CGM Investment, were not identified.

Early reports indicated that the deal was financed by overseas investors, although one city official said Thursday that he understood most of the money came from local sources.

The buyers formed a new company called Triangle Square Investments, headquartered in Temple City. CGM, also in Temple City, will take over management of the center.

Triangle Square, anchored by retailers Nike Town and Virgin Megastore, was one of the first experiments in mixed-use retailing. Its third story includes an Edwards cinema complex with six screens and a handful of restaurants and fast-food outlets. A Barnes & Noble bookstore and a Ralphs supermarket, accessible via the building’s enclosed parking structure, occupy the ground floor.

Ralphs, however, is on the way out, victim of a merger that required the chain to close one of its Costa Mesa stores. Ralphs says the Triangle Square store will be gone by October, leaving a vacancy that will be hard to fill. The looming departure could have lowered the final sale price for the center.

While never a huge hit with shoppers, the center has not been a failure either, lingering in retailing’s vast limbo of places that do OK but ought to be doing much better.

One drawback: a perception that parking is limited and hard to get to. There is sufficient parking, but it’s not visible because it’s in the core of the three-story center. “Southern Californians aren’t used to indoor parking,” said Ed Fawcett, director of the Costa Mesa Chamber of Commerce.

One area businessman said Triangle Square “has been a tough center to market.”

In a statement late Thursday, CGM President Kenny Wan said the new owners “intend to upgrade and further enhance” the center.

Fawcett called the center “the flagship” of the city’s downtown, an important fixture because it draws shoppers that benefit other merchants.

“The maintenance and quality of Triangle Square tenants is important to the success of all of the downtown community,” Fawcett said. “We hope the new owners recognize this and manage it accordingly.”

The deal was brokered by Eastdil Realty of West Los Angeles and Faris Lee Investments of Costa Mesa.