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HOUSTON-A 1031 exchange buyer from San Antonio has made another investment in the Bayou City, paying close to the $8.2-million list price for the 55,850-sf Village Green Plaza, a 92%-leased center with 26 tenants.
Houston Village Green Plaza LP acquired the eight-year-old center from its developer, locally based Village Green Plaza Ltd. The buyer assumed a $5.4-million conduit loan, due in September 2012, and carrying a fixed-rate interest of 7.14%, says Bill Lovejoy, a vice president with CB Richard Ellis Inc. who brokered the transaction.
Situated on 4.3 acres at the southeast corner of Kuykendahl and Louetta roads, Village Green Plaza is shadow anchored by a 64,400-sf Kroger's. The center is 92% leased to 26 tenants, including Hollywood Video, Cici's Pizza and Washington Mutual.
Most leases roll within three or four years, Lovejoy tells GlobeSt.com. The average rental rate is less than $15 per sf. "There's little downside with the rents since the center will be able to compete with the newer centers," he says.
Moreover, the center is located in a very affluent area with average household income level of more than $100,000.
Lovejoy has a long relationship with Houston Village Green Plaza LP. He listed the property for $4 million in 1993 when it housed a 77,000-sf structure leased to Eckerd and Minimax Grocery. The 1980 property, though, didn't sell. "It was probably the best thing to happen since Kroger came to them and wanted to build a store on the site," Lovejoy explains. In 1997, 75% of the original structure was demolished to make room for Kroger and Village Green Plaza.
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