"The market has become very aggressive. They were interested in taking some money out of this and reinvesting in another project in Phoenix," Michael Hackett, associate director of national retail development for Marcus & Millichap's Phoenix office, tells GlobeSt.com. Hackett represented both parties in the sale of the fully leased center.
Highgate marks the first Arizona asset for BJ&T Management, the purchasing entity of a private investor who intends to eventually move to the Phoenix area. Hackett says the investor, who also owns properties in Michigan, purchased the center to have awell-performing asset nearby once he relocates.
Built in 1980, Highgate Plaza offers a total 9,800 sf of single-story retail space, with tenants including Little Caesar's Pizza, Priority Medical and a water and ice store. Rent is $13.50 per sf. The new owner has already resurfaced the parking lot and plans newsignage for the site.
To help pay for the deal, BJ&T Management decided to refinance an existing retail center in Michigan instead of obtaining new financing in Phoenix because the terms were more favorable. Located at 4340 W. McDowell Road, the center sits in the heart of Phoenix's central corridor--a submarket that boasts very low retail vacancies. Smaller assets with local credit are bread-and-butter deals for many retail owners in this submarket, according to Hackett.
"It was more of a thing set up for retirement. They planned on retiring out here in the next 10 years," says Hackett. "This was a good way to pick up a really nice asset out here.
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