TUCSON-TNP Strategic Retail Trust Inc. has agreed to purchase Northgate Plaza Shopping Center for $8.1 million, which translates into a 9.5% cap rate.
The Irvine, CA-based non-traded REIT, which invests in grocery and drug-store anchored, multitenant necessity retail properties, will acquire the 103,500-square-foot center from Crestline Investments LLC. It will assume a $4.4 million loan for the property.
“Tucson is a stable market with less volatility than the rest of Arizona,” says Steve Corea, senior vice president of acquisitions for TNP Strategic Retail Trust.
Situated on roughly 7.8 acres at the northeast corner of Grant Road and Alvernon Way, Northgate Plaza houses 13 tenants. It is anchored by Wal-mart Neighborhood Market, which occupies 42,685, or 41.5%, of the center. The national grocery chain has a long-term lease through May 2025. Northgate Plaza’s junior anchors include Dollar Tree and Tuesday Morning, which are joined by Rent A Center, Burger King, Subway and Radio Shack.
“We found this property attractive because of Wal-Mart Neighborhood Market and its AA credit rating by Standard & Poor’s, the population density, with more than 37 percent of Tucson’s population within 5 miles and the declining unemployment rate in this market,” Corea says. “Additionally, the intersection at Grant Road/Alvernon Way has heavy pass through traffic daily.”
Corea tells GlobeSt. that TNP Strategic Retail Trust plans to increase the center’s occupancy, which is currently 80.7%.
Debbie Heslop at Volk Company represented the seller in the transaction.
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