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CHANDLER, AZ-An investment group has acquired Chandler Pavilions II, an 80,299-sf, class A retail center, for $13.6 million.
Town Lake Chandler Pavilions LLC of Scottsdale bought the two-year-old center from Chandler Pavilions II Shopping Center LLC, a Phoenix-based investment group. "It's a beautiful center in an emerging market," says Steve Schnitzer, senior vice president of Phoenix-based Coldwell Banker Commercial Metro LLC, who represented the buyer in the transaction. Cam Stanton of CB Richard Ellis Inc.'s Phoenix office represented the seller.
Schnitzer tells GlobeSt.com that Chandler Pavilions II was acquired in an off-market transaction. "Cam knew that we were looking for a replacement property to complete a 1031 exchange out of another retail center in Chandler," he explains. Town Lake Chandler Pavilions LLC assumed a $10-million loan at a 7.4% interest rate from Wachovia Bank to acquire the center, according to Schnitzer.
Situated on nearly seven acres at 845 to 865 N. 54th St., the center was developed by Opus West Corp. It is located east of Interstate 10 and Ray Road near the new IKEA store and about three million sf of new retail development. "This is a very strong submarket--comparable to North Scottsdale," Schnitzer says.
Schnitzer points out there is very little vacancy in the Chandler retail market and very little vacant land to build upon. "The area also gets very good rents," he says. Anchor space leases for about $14 per sf triple net while shop space leases for $25 per sf to $30 per sf.
Chandler Pavilions II is fully leased and anchored by national credit tenants, including PetsMart, Cost Plus, Ultimate Electronics, Starbucks Coffee Co., Mattress Outlet and Household Finance. All leases are triple net and expire in 2017.
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