Terry Moss with Bellevue's Commercial Realty Group Inc. tells GlobeSt the property had been under a contact with a buyer seeking a 1031 exchange. But a lease amendment necessary to the transaction could not be completed by the buyer's financing deadline.
Once the private transaction cratered, Moss put the property in the public listings. And interest appears to be keen. "We've had quite a bit of action," he quips. "In fact, we've already had two offers."
Staples, a publicly traded retailer of office supplies and services, is signed to a 15-year lease at this store, and multiple extensions are written into the agreement. With more than 1,300 stores throughout the U.S., Staples has been holding its own despite the recession.
The company entered the Washington market in 1996, though it kept its distance from the state's largest metropolitan areas of Seattle and Bellevue until last year. The first four of its eight 2001 openings came in June, including the Armada/Lagerquist property.
Some of the circling parties are investors looking for new properties. Moss says many are in the market for 1031 exchanges. Just about all are locals -- individuals, trusts and partnerships. "Institutional investors are fussy and tend to back of when things happen like Boeing layoffs," says Moss, adding, "Local investors tend to stay strong and will usually pay a better price."
The advertised capitalization rate on the property is 8%. The building measures 23,829 sf, on an 81,021-sf lot. With its prime location and tenant, Moss believes a buyer could secure 10-year financing locked at the rate of 7%.
Located at the intersection of 132nd and Hwy. 99, near an Interstate 5 entrance, the store stands in the midst of a substantial retail area. Other big box stores here include Pet Smart and the recently bankrupt K-Mart, as well as a new Albertson's grocery.
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